Senate
28 March 1935

14th Parliament · 1st Session

  1. Senate
  2. 14th Parliament
  3. 1935

The President (Senator the Hon. P. J. Lynch) took the chair at 3 p.m., and read prayers.

page 386

ASSENT TO BILLS

Assent to the followingbills reported : -

Sales Tax Procedure Bill1934.

Common wealth Conciliation and Arbitration Bill 1834.

Flour Tax Assessment Bill (No.2) 1934.

Flour Tax Bill (No. 1) 1934.

Flour Tax Bill (No. 2) 1034.

Flour Tax Bill (No. 3) 1934.

Wheat Growem Relief Bill (No. 2) 1934.

Wheat Bounty Bill 1934.

Northern Australia Survey Bill 1934.

Sales Tax Assessment (Fiji Imports) Bill 1034.

War Service Homes Bill 1934.

Special Annuity Bill 1934.

Trans-Pacific Flight Appropriation Bill 1034.

Loan Appropriation (Unemployment Belief) Bill 1834.

Seat of Government (Administration) Bill 1934.

page 386

PAPERS

The following papers were presented : -

Wheat, Flour nnd Bread Industries - Koyal Commission - Rnenmniandntion by the Commission in regard to allocation of relief moneys to wheat-growers who experienced adverse fanning conditions during the 1934-35 season.

Cold Bounty Act - Return for 1934.

Northern Territory Acceptance Act and Northern Territory (Administration) Act - Ordinance No. I of 193S - Medical Practitioners Registration.

page 386

QUESTION

OIL FROM COAL AND SHALE

Formal Motion of Adjournment

THE PRESIDENT (Senator the Hon. P. J. Lynch). - I have received from Senator Dunn an intimation that he desires to move the adjournment of the Senate this afternoon for the purpose of discussing a definite matter of urgent public importance, namely, “The failure of the Government to deal satisfactorily with the question of the extraction of oil from coal and shale”.

Four honorable senators having risen in support of the motion,

Senator DUNN (New South Wales; [3.5]. - I move -

That the Senate, at its rising, adjourn until 10 a.m. to-morrow.

I regard as vital to Australia the failure of the Government to deal satisfactorily with the proposal for the extraction of oil from coal and shale. The Governments of all European countries now appear to he directing their attention to the increase of armaments, and because of our isolated position, the neglect by the Government of the known and extensive mineral resources of this country, in particular the oil content of our coal and shale deposits of Newcastle, Cessnock, Ncwncs, Lithgow and the south coast of New South Wales may endanger the safety of the Commonwealth. There is ample evidence in the Parliamentary Library to support the arguments of honorable senators on this side that these resources could and should be exploited. The late Professor Edgeworth David definitely stated there was in sight in the northern areas of New South Wales from Newcastle right down to Gundagai, and from Sydney to Wollongong and Wanganelli, including the Lithgow seams, approximately 500,000,000 tons of coal. Despite the existence of these enormous deposits in the Cessnock and Newcastle districts there are at least 6,000 miners vvho have been unemployed for practically six years. The dire straits in which they and their wives and families are placed can only . be appreciated by honorable senators visiting those areas and gaining firsthand knowledge of the conditions under which they are living. In the southern coal-fields there are approximately 2,000 miners “ at grass,” to employ miners’ parlance, and in the western districts, from Katoomba to Lithgow, there are a further 2,000 miners with no work to do. I leave it to honorable senators to imagine how they and their wives and children are. living in these times.

According to the Commonwealth YearBook, Australia imported, duty free, in 1932-33. crude oil to the amount of 58,332,615 gallons,, and in 1933-34:, 57,656,418 gallons, or a total of 115,989,033 gallons. If the Government had imposed a’ duty of 2d. a gallon on that imported crude , oil it would have meant that manufacturers and those who use motor power in the production of their commodities in Australia could indirectly have given employment to 3,000 miners. I have worked in the mines of New Zealand and Australia, both as a boy and a man, and can visualize the result of 3,000 miners . being placed back on the coal face as a result of a duty of 2d. per gallon being placed on crude oil, produced by black labour and imported from the United States of America, the Dutch East Indies, Irak and elsewhere. As an instance of the use of crude oil, I mention that the Australian Glass Company alone uses each day two lorry tanks of crude oil, which is admitted into Australia free of duty. Most of that oil comes from the United States of America, whose people sneer at the traditions of the- British people and gloat over the fact that Australia has an adverse trade balance with their country. Last year the Prime Minister (Mr. Lyons) definitely pledged his word to the people of Newcastle and the surrounding districts that something would be done to extract oil from shale in Australia. It is true that the Government sent Mr. Rogers, one of its experts, overseas in this connexion, and that on his return to Australia, that gentleman submitted a report. I understand that the Government is about to send him away again. It has also been, reported in the press - I do not know whether rightly or wrongly - that the Minister in charge of Development (Senator McLachlan) will shortly proceed to England to inquire into the results of the experiments which have been conducted in Billingham-on-Tees and in Scotland in regard to the extraction of oil from coal.

The Government is spending thousands of pounds in sending men to other countries, notwithstanding that it has been proved beyond argument that the oil extracted from coal at BillinghamonTees fulfils all the requirements of the British Navy and Air Force. The members of the British Cabinet, and the experts attached to the defence forces of the Old ‘Country, are not fools. If the tests which have been carried out in England satisfy them as to the suitability of oil extracted from coal for the navy and air forces of Britain, that evidence should be sufficient for us in Australia, It is not a sufficient fulfilment of the Prime Minister’s pledge to the people of the Newcastle and Cessnock district to say that Mr. Rogers and, perhaps, a ‘Caibinet Minister, are about to proceed to the. other side of the world.

The Government went to the expense of bringing out to Australia a number of experts, headed by Sir John Cadman, the chairman of directors of the AngloPersian Oil Company, which controls huge oil-fields in Irak. Recently, newspapers of this country contained an account of the opening, by the King of Irak, of a pipe line many hundreds of miles long, for the purpose of conveying oil from the oil-fields of Irak to the seaboard at Mediterranean ports at a cost of £14,000,000. Why was Sir John Cadman, whose interests are in Irak, brought to this country, at the expense of the Australian taxpayers, whom we represent in this chamber, to report on the Newnes shale field and the extraction of oil from shale and coal?

Senator DUNN:
NEW SOUTH WALES

– Even if he did not. every facility was placed in his way to visit the fields, and his expenses were met. Is it reasonable to expect this man to issue a favorable report on Australian fields, to the detriment of the interest of the Anglo-Persian Oil Company?

Senator Sir George Pearce:

– I should like an opportunity to correct the misunderstanding in the mind of the honorable senator.

Senator DUNN:

– I have no desire to be diverted from my line of argument by the right honorable gentleman’s interjections. . Fifty years ago 2,000 men were engaged in the production of shale oil in New South Wales; to-day, Newnes is merely a shell - an industrial ghost. So bad are the conditions there that the only hotelkeeper in the place is unable to pay his rent. Is that because the Standard Oil Company has so many liens on the farmers of Australia, and holds so many promissory notes from business men in this country? Is it because the Standard Oil Company and its subsidiary companies have so many million pounds invested in Commonwealth bonds? Or is it because these companies are generous donors to the funds of the United Australia party? Are the Standard Oil Company and its subsidiary interests putting political bawbees into the funds of the United Australia party?

The PRESIDENT:

– The honorable senator is getting away from the subject

Senator DUNN:

– During the recent petrol price war, an attempt was made to bomb the works of the Independent Oil Company, which markets Purr-pull petrol. This was part of an organized attempt on the part of the combine, which is milking this country to the extent of £45,000,000 per annum in the purchase of oils and crudes from foreign countries, to smash an independent concern. Nothing has been done to develop ‘our oil resources in connexion with the defence of Australia, yet the. Leader of the Government, who has had a long experience as a Minister, and particularly as Minister for Defence, in various governments, knows how essential to the defence of this country is a guaranteed supply of petrol, not only as motive power for warships, but also for mechanized land units and the air force. This chamber is being constantly asked to vote hundreds of thousands of pounds for the purpose of equipping various defence units ir: Australia, yet nothing i3 done to ensure an unfailing supply of fuel oil in case of national emergency. In the two years, 1932 to 1934, 115,9S9,033 gallons of oil were imported from foreign countries. While this huge importation has been going on, 6,000 miners in the northern districts of New South Wales, 2,000 in the western districts, and 2,000 miners in the south coast’ districts of New South Wales, making a total of 10,000 Australian coal-miners, have been unemployed for six years, and have been compelled to walk the streets because the Government has neglected to put this industry on a satisfactory basis. Newcastle and the surrounding district have been able to carry on only because of the great steel works there and its subsidiary industries. If the Government would place a duty of 2d. a gallon on crude oil, 3,000 miners could be placed in employment within 24 hours. Only a few days ago Canon Hammond, a dignitary of the Anglican Church, who has interested himself in the welfare of the poorer classes of the metropolis of Sydney, said, when criticizing the New South Wales Government for having allowed an increase in the price of bread, that there were over 70,000- people on the dole there. Will any honorable senator contradict that gentleman’s statement? Everywhere on the coal-fields also men are idle. Recently the Prime Minister has been practically forced to his knees by the intrigues of politicians in the Mother of Parliaments. Surely the time has come when Australians should be prepared to stand up in defence of the rights of their country. As I have said, during the recent naval manoeuvres off the coast of Spain, the British Admiralty proved conclusively that oil from coal is quite suitable for its purpose.–. The aircraft employed in scout work in the manvres off the coast of Spain also used petrol as a test of what Great Britain could do in time of Avar. No doubt Senators Herbert Hays, J. B. Hayes and Payne, who are familiar with the shale deposits of Tasmania, will agree with me that, according to the financial and mining columns of the Melbourne Ago and the Sydney Morning Herald, the tests of Australian shales recently carried out by Scottish Oils (Shale) Limited showed that the highest percentage of oil was obtainable from the samples of shale from the Newnes district.

I urge the Government to cease backing and filling on the subject of unemployment and to do something of a practical nature in the interests of the industrial and business community of Newcastle where the great steel and subsidiary industries are established. This large district is populated by many of the finest industrialists in the Commonwealth. It is proved that on the northern mining fields 6,000 miners are still unemployed, and their wives and families are living on the dole. About 6,000 have done no work for the last six years. There are 2,000 unemployed in the western districts, including the Newnes field, and 2,000 in the southern districts from Helensburg to Bulli, Wollongong and Wollondilly. Perhaps our friend, Senator Brennan, who is a Doctor of Law, could become a Doctor of Divinity, and soften his heart to enable him to do something for the tens of thousands in New South Wales who are living in misery and degradation. The British Government has given a lead, and the Commonwealth Government might well take their courage in their hands and get on with the joh.

Senator Sir GEORGE PEARCE (Minister for External Affairs) [3.35].- While the honorable senator was speaking, I tried to correct a misstatement made by him, but he would not listen to me. Apparently he did not desire to know the facts. He referred to the oil experts who visited Australia recently to inspect the Newnes oil shale area, as having been despatched by the Anglo-Persian Oil Company, at the expense of the Commonwealth Government. I tried to inform him that that was not a fact, all the expense having been borne by the AngloPersian Oil Company. I remind him that half the shares in that company are held by the British Government.

Senator Barnes:

– To whom were the experts to report?

Senator Sir GEORGE PEARCE:

– Their report will eventually come to the Commonwealth Government.

Senator Dunn’s touching concern for the unemployed miners at Newcastle may be due, I think, to an election which is to take place shortly in New South Wales. I understand, from press reports, that the Federal Labour party has great pros- pects of capturing seats now held by the ung party in the Newcastle district, and that the latter party desires to show the electors that Codlin, not Short, is their friend. It is interesting to know that, when the Commonwealth Government asked the Lang Government to cooperate with it in finding money for the development of the Newnes shale area, that Government - and Senators Dunn and Rae are members of the Lang party - refused to give financial assistance. So, at that time, when unemployment was more severe than it is to-day, the party with which the honorable senator is associated did not feel so much concern for the unemployed miners’ as it claims to have to-day. But the present New South Wales Government has cooperated, and is co-operating to-day, in the steps which are being taken by the Lyons Ministry.

As honorable senators know, Senator

McLachlan is the Minister who deals with this matter. I have been supplied by his department with a statement as to what has been, and is being, done with regard to both the hydrogenation process for the extraction of oil from coal, and the Newnes shale deposits. The statement is as follows : - “ With a full appreciation of the unfortunate circumstances which exist in the coal-fields, and the necessity from the point of view of Empire defence of making Australia partially independent, at least from outside sources of supplies of oil, the Commonwealth Government during 1933 approached Imperial Chemical Industries Limited with a view to ascertaining the terms and conditions under which that company would be prepared to erect and operate a plant in Australia with a capacity of 1,000 tons of coal a day. In reply to those representations, the company informed Mr. Bruce that, it was willing and anxious to give the fullest, co-operation and assistance in establishing a. large-scale hydrogenation unit in Australia. It was pointed out, however, that it. is essential to wait until the company has had six months’ experience of running its first English plant at Billingham-on-Tees before any definite proposal is formulated. The company states that it is inevitable that actual working on a large scale plant will reveal the necessity for some modifications in design and construction. The company also hopes that this experience will enable a substantial decrease in the capital cost of subsequent plant, and increase the efficiency of the process. Hence the company regards it as most unwise to embark upon the construction of a. further unit until experience of the first plant has been obtained. “ Imperial Chemical Industries Limited stated that the construction of the first unit is proceeding with the utmost rapidity; but. in view of the vastness of the constructional work necessary, it would not be possible to commence operations before January, 1935. “It was further stated by Imperial Chemical Industries Limited that its engineers have already fully surveyed the possibilities in Australia, including bulk hydrogenation tests of all important seams of Australian coal, and the selection of a site for the plant. The company also estimated, on present experience, that the cost of erecting a unit in Australia capable of using 1,000 tons of coal a day, would be between £S,000,000 and £9.,000,000 in Australian currency. It is to be hoped that this figure will be capable of substantial reduction in the light of experience at Billingham-on-Tees, because any reduction of capital outlay- will be reflected in a corresponding reduction of the cost of production of petrol. “ On 23rd March, 1934, a promise was made by the Prime Minister to a representative gathering of coal mining interests at Cessnock to the effect that he was prepared to ask Cabinet to give consideration to the question of whether, in co-operation with the Government of New South Wales, it would be advisable to ask Imperial Chemical Industries Limited to undertake the construction of a plant in Australia concurrently with construction at Billingham-on-Tees. It became apparent, however, before the matter could be considered by Cabinet, that some divergence of opinion existed as to the proper location for a plant, and the relative merits of brown coal as distinct f rom black coal. Strong representations in this regard were made, by different State Governments. Accordingly, it was decided that these unknown and undetermined factors should be cleared up before a further approach was made to Imperial Chemical Industries. The States and the company were asked to appoint representatives to a committee to conduct investigations. This committee was appointed in April, 1934. The committee comprised the following representatives :- “ Commonwealth. - Dr. A. C. D. Rivett, chief executive officer, Council for Scientific and Industrial Research, chairman; Mr. L. J. Rogers, Commonwealth fuel adviser;. Commander A. D. Nicholl, R.N., defence services. New South Wales. - Mr. E. C. Andrews, formerly

Government geologist. Victoria. - Dr. H. Herman, research engineer, State Electricity Commission. Queensland. - Mr. J. B. Henderson, Government analyst. South Australia. - Dr. L. Keith Ward, director,. Department of Mines. Tasmania. - Mr.. P. B. Nye, Government geologist; and Mr. Norman Taylor, of Imperial Chemical Industries of Australia and New Zealand,- who has been nominated by Synthetic Coal Oil Products Proprietary Limited. Western Australia did not desire to be represented. “ The committee found it impossible to reach any definite conclusion in regard to the reference pending the completion and experience of the working of thelargescale plant then in course of construction by Imperial Chemical Industries Limited at Billingham-on-Tees, England. The committee stated that the design and erection of this plant had been proceeding for some twelve months, and it was anticipated that the operating stage would be reached early in 1935. It was being found, however, that continuous modification of initial plans waa demanded, partly as the result of actual experience in erection and partly as the result of alterations and improvements in technique on the chemical side which were all the time being effected. The consequence was, the committee added, that when the plant is completed, parts of it will already be obsolete, and that it would be folly to initiate any establishment of plant in Australia until this invaluable Billingham experiment is completed. “ The following extract from the report appears to aptly sum up the position : -

We realize that disappointment will follow an announcement of a conclusion that it would bc folly to attempt the erection of a hydro.genation plant until the results of the rapidly progressing large-scale experiment at Billinghain are available. No other course, however, is open to us. Where millions of pounds are involved in capital coat, it would be unbusinesslike, to the point of recklessness, to risk the almost certain loss of a considerable portion of it rather than wait another twelve months for information that will make possible the avoidance of such loss. We feel certain that no private organization, adequately informed of the position, would embark upon a premature venture of the kind; and the risking of public money would be equally unjustifiable.

The committee concluded by recommending that it be kept in existence on the understanding that it will remain as closely as possible in touch with developments elsewhere and will meet at the earliest date at which it becomes apparent that decisive answers can be given to the questions which have been submitted to it. The Governments of the Commonwealth and of the States concerned agreed to this proposal. Mr. L. J. Rogers, the Commonwealth fuel adviser, who is at present in America in connexion with tests associated with the production of oil from shale, has been asked to visit Great Britain for the purpose of conferring with representatives of Scottish Oils (Shale) Limited regarding such tests, and to obtain the fullest information, in regard to progress at Billingham-on-Tees, and in connexion with other fuel developments. It is expected that Mr. Rogers will arrive in Great Britain some time during April. “In connexion with the shale oil industry, the Newnes Investigation “Committee, which was appointed by the Governments of the Commonwealth *nd New South Wales, carried out’ a thorough investigation of the Newnes shale oil project, involving the conduct of tests in Britain and America, and recommended that a company be formed with a capital of £600,000, £300,000 of which was to be provided jointly by the governments on a. deferred basis for the purpose of carrying out large-scale operations at Newnes. These operations would involve the production of about 6,000,000 gallons of petrol and 20,000 tons of crude oil per -annum. “ TI te report was considered by both governments, which agreed that negotiations should be entered into with persons considered to be possessed of the necessary technical and engineering qualifications with a view to bringing about the development of Newnes on the lines recommended by the committee. Both governments agreed that if the right type of company could be interested, financial and other assistance would be provided as an inducement. Negotiations were accordingly opened up with the AngloPersian Oil Company Limited, and Sir John Cadman, the chairman of directors of that company, who visited Australia and inspected Newnes during October.

L934, undertook to send out experts to conduct an investigation into the shale oil industry of Australia. Pursuant to this promise, Messrs. Robert Crichton and H. R. J. Conacher, general manager and manager respectively of Scottish Oils (Shale) Limited, arrived in Australia at the end of January, 1935: These gentlemen inspected Newnes, Marrangaroo, Baerami and Wollar fields in New South Wales, and Latrobe in Tasmania. They completed their investigations and sailed for England on 5th March. Before their departure they informed Senator McLachlan and Mr,. Vincent, the Minister for Mines of New South Wales, that they had collected all available data and it would be necessary for them to analyse this information and to carry out certain experiments and tests in Scotland before reaching any definite conclusions, which would be embodied in a report that they would submit to Sir John Cadman1. It is expected that the report may be available in time for Sir John Cadman to discuss it with the Prime Minister while he is in England.”

As I have already stated the investigation was not conducted at the expense of the Commonwealth Government; as stated by Senator Dunn; the whole of the cost was defrayed by the AngloPersian Oil Company. It will be seen from the information which I have given that the Government has been energetic in this matter. It has conducted investigations on proper businesslike lines, testing the process step by step so that money should not be wasted, and so as to ensure that when operations are commenced they will be on an economic and sound basis.

Senator BROWN:
Queensland

– I support the motion moved by Senator Dunn, because there is a feeling abroad that the Commonwealth Government has adopted the I. W. W. “ go-slow “ policy, and that, owing to its tardiness, we have not reached that stage of development which we should have reached years ago. We admit that it is essential to obtain the fullest information concerning the production of oil from coal or shale, but much could have been done by way of experiments in Australia instead of depending, as is usually the case, upon action by vested interests in other cou u tries. In Australia we are always backward in conducting experiments essential to the welfare of this country. Apart from the production of oil from coal or shale, it is well known that for many years attempts have been made in Queensland to discover gusher oil, and that just when conditions have appeared to be favorable drills have become jammed in the bores necessitating the suspension of operations. Impartial persons have stated that certain interests have been at work to prevent the discovery of oil. This has b.een done deliberately, because if oil were discovered in Australia it would be detrimental to the interests of certain foreign oil companies.

As regards the development of the Newnes deposits, it seems to me that the Government has been slow to do anything. We have heard the argument that experiments overseas have proved that it would not pay to attempt to produce oil commercially from our shale deposits, and that the Government must be careful about making any forward move because of the probable loss of public money.’ This is a peculiar argument from a government which is prepared to spend millions of pounds on a cruiser, for instance, and to squander vast sums of public money on commissions, which present reports that are pigeonholed and forgotten. Since the inception of the Federal Parliament, it is probable that several hundreds of thousands of pounds have been spent on inquiries by commissions, and similar bodies which have presented innumerable reports that have been filed and put away, and only occasionally glanced at by som<! one who may be, for the moment, interested in the various proposals that formed the subject of inquiry. We, on this side, contend that the Government would be amply justified in carrying out experiments of the nature indicated in this motion without waiting for the results of similar experiments by huge private organizations on the other side of the world.

I am informed by Senator Dunn that oil from coal is being produced in the Mother Country. If this Government was in earnest about the development of the oil industry in Australia, it would have been prepared, from the point of view of defence alone, to spend money on experimental projects without waiting from year to year to ascertain what has been done by big companies overseas.

Senator Herbert Hays:

– Many experiments in the production of oil from coal and shale have been carried out in this country.

Senator BROWN:

– They should be carried a little further, and a- serious attempt made to produce oil from coal and shale on a commercial basis. Government supporters take the view that expenditure on experiments of this nature would be so much money wasted. We, on this side, contend that this work should be carried out in the interests of Australia.

Senator Herbert Hays:

– Attempts to produce oil on a commercial scale have failed.

Senator BROWN:

– I have in my hand a report which appeared in the Australian Industrial and Mining Standard of the 15th February, 1935, which states -

There wre now many methods of splitting up raw coal into oil and by-products, and scientists are busy devising still more in the hope of finding the perfect process. In many ea.-es they have been successful in small experimental plants, without convincing experts that they would meet all requirements in large-scale production over long periods of time. At one time it seemed as if the cheapness of natural oil and spirit would discourage further efforts to discover a method nf producing an ideal synthetic product. But the present Government subsidy–

I presume this means assistance provided by the British Government- of 4d. a gallon was a new incentive to further effort. The Imperial Chemical Industries spent £1,000,000 on new plant and other companies also engaged in further experiment.

This is what I wish to emphasize -

The British Department of Overseas Trade, in a recent bulletin, says that one of the latest and most important methods is that of the Cannock process, which makes use of radiant heat for breaking up a mixture of coal and tar. It has the merit of simplicity. A staff of five men are now handling 150 tons of coal a day and producing, by the Cannock method, 15 gallons of spirit and 15 cwt. of smokeless fuel from each ton. A famous motorist and a famous airman have each testified to the excellent quality of the spirit produced, and well-known scientists have admitted that the Cannock plant does what is claimed for it. Professor Julian Huxley started his investigations of the new method in a spirit of complete scepticism. “I .felt it was too good to be true “, lie said of the claim made for the Cannock process, hut he had to admit later that he believed it was true.

Iii view of the results achieved, I maintain that instead of” squandering money in futile efforts to spread the purchasing power among the workers per medium of the dole, this Government should, without further delay, carry out experiments for the production of oil from our coal .and shale deposits. Are we entirely lacking in initiative that we should wait until som,e one on the other side of the world, some clay and in some way, demonstrates that the production of oil from coal or shale is a commercial possibility? Yet that is the attitude taken up by this Government. It would appear that Ministers and their supporters are afraid of the probable loss - they are cowed by ciphers, as it were - and, because of the risk involved, are afraid to do something really useful for Australia.

To be absolutely impartial in my discussion of this motion, I direct attention also to another article which appeared in The Australian Industrial and Mining Standard, of the same date, dealing with the oil shales of Australia. It was written by Mr. Hartwell Conder, M.A., who discusses the problem with all the caution of a tory objector to anything being done by the Government. Mr. Conder states -

From both laboratory and large scale records it is found that a conservative estimate is a yield of 100 gallons of crude oil per ton of « Iia le.

T think Senator Dunn mentioned this figure in the course of his speech. Mr. Conder goes on to say -

To the taxpayer the main issue is the economic one. . . . Total annual costs are estimated at’ £218,000, or with output of 125,000 ton’s at 35s. a ton.. Depreciation £20,700 increases this by about 4s. per ton to 3!)s. per ton. Income is the result of the following: -

At first glance this would appear satisfactory, since the margin is sufficient to pay good interest on the £(100,000, which is figured us essential capital outlay; but there is a very serious “ snag “.

This will interest the income taxpayers on the other side of the chamber -

The costs given for imported motor spirit are -

The representatives of Queensland in this chamber are interested in the proposal to develop the Newnes shale deposits, because Queensland has large coal deposits having great potential value from the point of view of oil production. Mr. Conder argues that, if no excise duty were paid on the 6,000,000 gallons proposed to be produced at Newnes, it would mean a loss of . customs revenue of £187,500 on a similar quantity of imported petrol. I contend, however, that % Lt would be a better proposition, and in the interests of the Commonwealth, to develop our own resources, even if we have to forgo a certain amount of customs revenue on imported fuel. Notwithstanding the statement made by the Leader of the Senate with regard to the activities of the Government in this matter, we submit that, if the Ministry had been in earnest, there is not the least doubt, that we should to-day be producing oil in considerable quantities, and thousands of miners, who at present are on the dole, would be again in employment.

Senator RAE:
New . South Wales

– The Leader of the Senate (Senator Pearce), in his reply to Senator Dunn, began by a characteristic sneer at the motives underlying the motion. I remind him that our term in this Parliament is short, and that we have no personal interest in the coining elections in New South Wales. This should effectively dispose of his sneer at what he suggests were the motives of my colleague. Delay in accomplishing anything of a practical character in connexion with our shale and coal deposits is due to a conspiracy on the part of huge vested international interests to prevent Australia from developing its known oil resources. We have been told that the Anglo-Persian Oil Company recently sent experts to Australia at its own expense to investigate the possibilities of extracting oil from our shale and coal deposits. Does any honorable senator for a moment think that that concern would have anything to do with a proposal which might interfere with its profits in the Australian trade? I do not like to think evil of any individual, but I know what private enterprise is capable of doing, and I feel sure that, if foreign oil companies take any interest in our affairs, it is not with a view to assisting us to develop our own resources, but to safeguard their own position. The Imperial Chemical Industries Limited, with its head-quarters in Great Britain, is a huge international monopoly, and is not at all likely to do anything to assist in the development of Australian resources in oil fuel, unless it can get its own finger in the pie and reap substantial profits for itself. It is one of the biggest monopolies in existence. Although its head-quarters are in Great Britain, its ramifications extend all over the world.

Senator Foll:

– It has already spent £1,000,000 in trying to develop the hydro.genation process.

Senator RAE:

– I do hot dispute that; but the money has not been expended in Australia. Moreover, I should like to know whether the company is under any obligation to submit reports to the Commonwealth Government, seeing that it has sent its experts here at its own expense. I imagine that six years hence we shall still be hearing various excuses for doing nothing. The Leader of the Senate (Senator Pearce) read an amazing story this afternoon, showing how these experiments were continually being altered, because of new discoveries, and the application of fresh methods.. He pointed out that before any practical results could be obtained under one process, the first units installed would become obsolete, and practically so much waste capital. If that statement means anything, it means that we shall go on doing nothing until a perfect system has been evolved; otherwise we shall find, when we have partially completed our works, that they are out of date, and will require to be replaced or modified at considerable expense. To my mind, theseare but ingenious excuses for doing: nothing. There is scarcely any invention, however great its value, which cannot be improved as the result of experience. If the world had waited for a perfect motor car before using the imperfect machines which were first placed on the roads, the present huge industry of motor car manufacturing and its subsidiary industries,, would never have been established. Nearly 50 years ago the Commonweal ti i. Oil Corporation produced oil from shale at Newnes. Previously, at Hartley Vale,, works had been erected, and oil, as well as a number of by-products of considerable value, were extracted from t]iedeposits there. Before the present experiments in Britain were undertaken, works for the extraction of oil from shale had been established in Scotland, and the product had been used ‘commercially. The value of the Scottish shale is considerably lower than that of theshales found on the mainland of Australia and in Tasmania.

Senator Foll:

– Did not private enterprise lose a fortune trying to developNewnes ?

Senator RAE:

– Private enterprise failed to make a success of that venture, and no wonder. We hear a good deal of the blunders, mistakes and extravaganceassociated with State enterprise; but if the honorable senator knew even as much as I know of the way in which money was squandered by private enterprise at Newnes, he would not wonder that the experiment failed. Even the railway line which was constructed to link up with the western railway system was enormously expensive. Experts tell us that easier grades could have been found had Newnes been approached by railway from a different direction altogether. TheLeader of the Senate told us to-day that the selection of a suitable site for the establishment.. of the works at Newnes is still under consideration. If the menconcerned deserve the title of experts, they should long ago have found the most suitable place to erect the plant. The reasons advanced for the delay seem to be so flimsy that I can only regard them as a series of ingenious excuses for holding up this work indefinitely. There appears to me to be a conspiracy against the discovery in Australia of oil in its natural state, or the utilization of coal and shale in the production of oil. That is largely the view of Senator Brown, who said that vested interests come to this country, not for the purpose of finding oil, but for the express purpose of seeing that it is not found. The way in which bores have been sunk and machinery broken, suggests sabotage on an extensive scale. Until more practical results are obtained by an earnest government, I shall not be satisfied that vested interests have not deliberately and successfully attempted to prevent both the discovery of oil and the extraction of oil from coal or shale in Australia. I read recen’tly the report of an expert who stated that the quality and nature of coal in different countries, and, indeed, in different districts of the same country, varied so greatly that the most complete experiments in one place were not necessarily a sound guide on which to base ventures in another place. If that he so, surely we should conduct our own experiments on a sufficiently large scale to demonstrate beyond doubt whether or not the desired products can be produced here. I do not pose as one having technical or expert knowledge of this subject, but I do say that all the facts which have accumulated over a number of years indicate that either there has been colossal blundering on the part of the alleged experts, or that most of them have been in the pay of the big oil interests which dominate the oil trade throughout the world. It would appear that we shall never get a square deal here until we have the grit and the energy to take the matter entirely into our own hands, and establish works on a sufficiently large scale to prove whether or not oil can be extracted from coal or shale on anything like a commercial basis. Even if it is not necessary to have our own. sources of oil for defence purposes, the fact remains that oil is such a necessary commercial commodity, and plays so important a part in the general life of the community, that we would be justified in obtaining our own supplies in this country even at. a cost in excess of that at which oil could be imported.

Senator SAMPSON:
Tasmania

– The subject introduced by Senator Dunn this afternoon is of tremendous interest to Tasmania. I have vivid recollections of a. motor car, bearing a placard stating that it was propelled by petrol extracted from shale from the Latrobe district, being driven through Tasmania about 25 years ago. In those days a large number of Tasmanians saw visions and dreamed dreams. They saw, in fancy, a hive of industry in the Mersey Valley in the vicinity of Latrobe ; a pipe line following the course of the river to the port of Devonport; tankers at Devonport loading the crude oil and taking it to the vessels of the Navy, which at that time were just beginning to burn fuel oil. I suggest to the mover of the motion that it is not quite fair to tax the present Government with laxity in regard to this subject. For many years, and particularly during the last ten years, investigations have been carried out in regard to the extraction of oil from shale, and more recently a vast amount of work has been done, and much money expended, in an endeavour to do so on a commercial basis. I speak now more particularly of the experiments in connexion with the hydrogenation of coal. At the back of the -minds of all the. great powers of the world is the necessity for maintaining adequate fuel supplies. Should they ever, again be engaged in a major war, they will need to be assured of adequate supplies of fuel. In the event of such a struggle, one nation which is now entirely dependent on outside sources for fuel for its air force, its navy, and its mechanized army, would be immobilized in, a month or two because of a shortage of fuel supplies. Its fleet, and, indeed, its whole naval, military and air force equipment . would, in that event, be merely so much junk. The Government has had to proceed cautiously, particularly in regard to Newnes, which was specially mentioned by Senator Dunn. It must not bo forgotten that the Commonwealth Oil Corporation lost about £2,000,000 at Newnes, and that, more recently, Messrs. Treganowan and Chambers failed to float a company to develop the deposits there, notwithstanding that they were assured of government assistance. They failed because investors had not been convinced- that oil could be extracted from shale as a commercial proposition. Subsequently, the Lyons Government obtained the services of Mr. Rogers to advise it in regard to this matter. If we are to conduct our own experiments, as Senator Brown suggested, an initial capital outlay of probably £250,000, and an annual expenditure of £100,000 for the maintenance of a laboratory, would be necessary. Why should we do that, -when we now have full and free access to the results of the experiments carried out at the British’ Fuel Research Station at Greenwich? I remind Senator Brown that, after all, oil is only a by-product of the process of hydrogenation of coal, the main product being coke. Where, in Australia, would we find a market for the coke which would be obtained if we were to supply from local sources our own oil requirements? There would be a lack of proportion in regard to the two products. In making these observations, I have been guided by what I have read, and also by letters which 1 have received during the last seven years from a gentleman who has been engaged as a chemist at Billingham-on-Tees, England. Imperial Chemical Industries Limited has spent over £1,000,000 on experiments in connexion with the hydrogenation process, and we shall be able to take full advantage of the results of that expenditure. The suggestion that the experiments conducted by Imperial Chemical Industries Limited are likely to go on indefinitely, is absurd. Is it not reasonable that we should await the report of the first experiment, which will be made available very soon, before incurring further heavy expenditure in this direction? Unless we proceed carefully, step by step, we may find that we have been following the wrong course, and that all our expenditure has been futile.

Senator Rae:

– Will the result of the experiments of Imperial Chemical Industries Limited enable us to dispense with further experimentation?

Senator SAMPSON:

– No. But it will give our chemists and other experts valuable data on which to base further experiments. Until all the data have been compiled it is idle to suggest the spending of gigantic sums of money on research. . Senator Brown has spoken of the squandering o’f money. I suggest that the adoption of his proposal would mean the squandering of money, and the squandering of it blindly.

Senator Brown:

– I rise to a. point of order. It is scarcely fair for the honorable senator to ascribe to honorable senators on this side of the House words which they never used. No honorable senator on this side spoke of spending gigantic sums of money.

The PRESIDENT (Senator the Hon. P. J. Lynch). - My recollection of what the honorable senator said is that it was useless to go on spending gigantic sums of money. He did not ascribe the remark to any particular honorable senator. The point of order cannot be upheld.

Senator SAMPSON:

– I merely suggested that before we endeavour to produce oil in large quantities by the hydrogenation process, we should await the result of the experiment now being carried on in England - perhaps the biggest of its kind that the world has hitherto known. Scotch shale, which had been worked for 100 years or more, only came into its own during the war period when, for the last eighteen months of the conflict, the British fleet was in the main fuelled by oil extracted from it. That, however, was a war measure; costs then could not be considered since it was absolutely vital that supplies should be forthcoming. Compared with the New South Wales and Tasmanian deposits, Scotch shale is poorer in yield, but the seams there are eight to twenty feet thick as against seams of only about four feet in the case of New South Wales and Tasmania. That makes a tremendous difference to the mining costs.

In the past vast sums have been invested and lost in efforts to develop the shale deposits in my State and particularly in New South Wales. I cannot, however, agree with the suggestion by honorable senators opposite that some malign influence is at work in an endeavour to retard or prevent the development of the industry. It is impossible to make a comparison between the cost of shale oil and flow oil, and it is certain that at present it is not a commercial proposition to produce shale oil in Australia in competition with flow oil coming from other parts of the world. Shale oil in time to come may come into its own, but at present its production is unprofitable. Again and again we have hoped that success would attend our efforts, but those hopes have been shattered by the hard, cold, economic fact that the mining, retorting, crushing, and cracking costs are too high to permit it to compete against the flow oil. The representatives of Tasmania and its people generally would be delighted if it were possible to produce oil from shale on a profitable basis, because it would mean much to the island State. But, in the past, it has proved an expensive experiment to many people who have been courageous enough to put their money into it. I suggest to the mover of the motion (Senator Dunn) that to endeavour to cast the blame on this Government is rather far-fetched.

Senator Dunn:

– I blame the governments of the past twenty years.

Senator SAMPSON:

– To place the blame on this Government is bordering on the grotesque.

Senator DUNN:
New South Wales

– in reply - I thank honorable senators for having given me an opportunity to bring this important matter before the Senate. I desire to congratulate Senator Sampson on his clear and fair criticism of my remarks on this subject. I regret that I cannot say the same of the Leader of the Government (Senator Pearce), since he dealt quite flippantly with the actions of honorable senators on this side in regard to this matter. During the last six years, this subject has been brought up time and again by my colleague, Senator Rae, and myself.I agree with Senator Sampson that this Government is not wholly to blame for the delay that has occurred in taking, action. I blame all federal governments. The Leader of the Government, prefaced his remarks by saying that I had brought this matter forward because a State election was pending in New South Wales, and because I feared that Lang candidates would be defeated in . the coal-field divisions of New South Wales. That suggestion comes from a mind as dirty and filthy as a sewer.

The PRESIDENT:

– Order ! The honorable senator is out of order.

Senator DUNN:

– You, sir, did not take the Leader of the Government to task when he attacked me.

The PRESIDENT:

– The honorable senator will resume his seat. I ask him to withdraw the offensive words.

Senator DUNN:

– I will not withdraw them. The Leader of the Government should be made to withdraw his offensive words.

The PRESIDENT:

– Order !

Senator DUNN:

– I repeat that his mind is as dirty and as filthy as a sewer.

The PRESIDENT:

– Order ! Order !

Senator DUNN:

– Senator Pearce owes his position in the public life of this country to-day to men and women like those of the northern districts of New South Wales who assisted in sending him here as a representative of Labour for Western Australia.

The PRESIDENT:

– Order !

Senator DUNN:

– In speaking as he has spoken about Lang candidates in New South Wales, he is a political liar.

The PRESIDENT:

– I name the honorable senator for wilful disobedience of the Chair.

Senator Sir George Pearce:

– In accordance with the usual practice, and in view of the honorable senator’s declaration that he will not withdraw, I move -

That Senator Dunn be suspended from the sitting of the Senate.

Senator Rae:

– I ask, Mr. President, if it is right that the Leader of the Government in the Senate should submit this motion, and so be the judge in his own case. It is rotten justice.

The PRESIDENT:

– The right honorable gentleman is the Leader of the Government in the Senate, and the Standing Orders provide for the action he has taken. I appeal to Senator Dunn to reconsider his position, and to withdraw the offensive words used by him.

Senator DUNN:

– If the Leader of the Government is prepared to withdraw his allegations against the party which I lead in this chamber, and his statement that I as the mover of this motion was actuated by the fact, that a general election was shortly to be held in New South Wales, I will withdraw my remarks. If he will not then I shall repeat that the allegation comes from the craven, mind of a political coward - a mind as filthy as a sewer.

The PRESIDENT:

– Then I have no option but to put the motion.

Senator Dunn:

– Go your hardest I

The PRESIDENT:

– Order. I remind the honorable senator that he was rather free in his remarks concerning the Government.

Senator Rae:

– I shall not tolerate a motion being moved by the Leader of the Government when he is acting as the judge of his own case. If you put Senator Dunn out you will put me out.

The PRESIDENT:

– I ask honorable senators not to forget that they are not here to lower the dignity of this chamber.

Senator Dunn:

– You did not ask Senator Pearce to withdraw what he said against me.

Question - put. The Senate divided. (President. - Senator the Hon. P. J. Lynch.)

AYES: 17

NOES: 4

Majority . . . . 13

AYES

NOES

Question so resolved in the affirmative.

Senator Dunn thereupon withdrew from the chamber.

SenatorFoll. - I draw your attention sir, to the fact that, a few moments ago, Senator Rae. said that the action being taken was a disgrace to the Leader of the Government and also to the President.

Motion (by Senator Pearce) proposed -

That Senator Rae be suspended from the sitting of the Senate.

Question - put. The Senate divided. (President: - Senator the Hon. P. J. Lynch. )

AYES: 17

NOES: 3

Majority . . . . 14

AYES

NOES

Question so resolved in the affirmative.

Senator Rae thereupon withdrew from the chamber.

Original question resolved in the negative.

page 399

QUESTION

DOCK AT FREMANTLE

Senator E B JOHNSTON:
WESTERN AUSTRALIA

asked the Leader of the Government in the Senate, upon notice -

What decision has ibeen arrived at by the Government in regard to the request of the Government of Western Australia for assistance towards the provision of an up-to-date dock at Fremantte?

Senator Sir GEORGE PEARCE:

– The Acting Prime Minister has supplied the following answers: -

The Commonwealthasked all States to submit programmes of public works in connexion with its policy of co-operation with the States in order to relieve the unemployment situation. The Government of Western Australia, in a list of works involving a total expenditure of £9.125,000, included provision for a dock at Fremantle at an estimated cost of £1,000,000.

The amount of £125,000 for the State of Western Australia for which provision was made in the Loan Appropriation (Unemployment Relief) Act 1934 is to be expended on a £1 for £1 basis mainly for water and sewerage works in country towns.

The other items on the list will he considered when the allocation of further funds by the Commonwealth Government for unemployment relief is receiving attention.

page 400

QUESTION

WIRELESS BROADCASTING

Perth Studio - Broadcasting Stations in Western Australia.

Senator E B JOHNSTON:

asked the Postmaster-General, upon notice -

  1. What is the reason for the delay in erecting the promised new studio in Perth for broadcasting station6WF?
  2. When is it expected that,the construction of the building will be commenced?
Senator Sir GEORGE PEARCE:

– The Postmaster-General has supplied the following answer: -

The provision of studio buildings is entirely under the control of the Australian Broadcasting Commission. Inquiries have, however, been made and, upon a reply being received, the information will be furnished.

Senator E B JOHNSTON:

asked the Postmaster-General, upon notice -

When is it anticipated that the new broadcasting stations at (a) Minding near Wagin. and (6) Kalgoorlie, Western Australia, will be opened for broadcasting?

Senator Sir GEORGE PEARCE:

– The Postmaster-General has supplied the following answers : -

  1. No opening date can be indicated until the testing , period of the station has been reached. This will occur towards the end of the year.
  2. A decision has not yet been reached to proceed with the erection of a station at Kalgoorlie, but it will be considered in conjunction with the next portion of the construction prograanme to bo undertaken.

page 400

QUESTION

RABBIT-PROOF NETTING

Purchase by States - Customs Duties.

Senator E B JOHNSTON:

asked the Minister representing the Minister for Commerce, upon notice -

  1. Has the Government received a request from the Government of Western Australia foran extension of the assistance given to the States for the purchase of rabbit-proof netting for settlers?
  2. What decision has been arrived at in the matter ?
  3. Is it intended to reduce or waive the interest charged in the past on such advances?
Senator BRENNAN:
Minister without portfolio assisting the Minister for Commerce · VICTORIA · UAP

– The Minister for Commerce has supplied the following answers : -

  1. Yes.
  2. and 3. The Premiers of the States have been asked to furnish the Commonwealth with their views and to submit their proposals regarding the provision of wire and wirenetting to settlers. This matter has also been listed for consideration at the forthcoming meeting of the Australian Agricultural Council to be held in Sydney on the 15th April.
Senator E B JOHNSTON:

asked the Minister representing the Minister for Trade and Customs, upon notice -

In view of the reported serious increase in the rabbit pest in Western Australia, is it the intention of the Government to waive or reduce the tariff on rabbit-proof netting or wire imported from foreign countries?

Senator Sir GEORGE PEARCE:

– The Minister for Trade and Customs has supplied the following answer: -

No. Rabbit-proof netting is admitted free of duty from the United Kingdom and under the Ottawa agreement Australia is committed to maintain the existing margin of £10 per ton in favour of the United Kingdom. .

page 400

QUESTION

MOTOR BODY PANELS

Senator E B JOHNSTON:

asked the Minister representing the Minister for Trade and Customs upon notice -

When will the Tariff Board’s report on motor body panels be available to the Senate?

Senator Sir GEORGE PEARCE:

– The Minister for Trade and Customs has supplied the following answer: -

The Tariff Board report will be tabled at an early date.

page 400

QUESTION

CAPTAIN CONWAY

Senator DOOLEY:
through Senator Barnes

asked the Minister representing the Minister for Defence, upon notice-

If no finality has been reached in the claim of Captain T. P. Conway for compensation, will the Minister for Defence agree to the appointment of three members of this Semite its a committee to inquire into the claim and report back to the Senate as early as possible?

Senator Sir GEORGE PEARCE:

– The honorable senator’s question will be brought under the notice of the Minister for Defence, and a. reply will be furnished as early as possible.

page 401

QUESTION

TRADE COMMISSIONERS

Senator DUNCAN-HUGHES:
SOUTH AUSTRALIA

asked the Minister representing the Minister for Commerce, upon notice -

  1. Have any trade commissioners been appointed in the East since the last sittings of the Senate?
  2. Is it intended to make any such appointments?
Senator BRENNAN:
UAP

– The Minister for Commerce has supplied the following answers : -

  1. No.
  2. The Government has decided to appoint trade commissioners in Japan, China, Netherlands, East Indies and Egypt. Appointments will be made after the meeting of the Eastern Trade Advisory Committee to be held in Sydney next month.

page 401

QUESTION

COMMONWEALTH BANK

Gold Stocks

Senator BROWN:

asked the Minister representing the Treasurer, upon notice -

What is the amount of gold, valued in Australian currency, held by the Commonwealth Bank ?

Senator Sir GEORGE PEARCE.The Acting Treasurer has supplied the following answer: -

The question has been referred to the Commonwealth Bank, and a reply will be furnished as early as possible.

page 401

QUESTION

GLASS INDUSTRY

Great Britain’s Quota

Senator BROWN:

asked the Minister representing the Minister for Commerce, upon notice -

Has any communication been received from the British Government, by way of protest or otherwise, concerning Britain’s quota for the sale of glass in Australia?

Senator BRENNAN:
UAP

– The Minister for Commerce states that the answer is - No.

page 401

NAVIGATION BILL 1935

Motion (by Senator Brennan) agreed to-

That leave be given to introduce a bill for an act to amend the Navigation Act 1912-1934.

page 401

COPYRIGHT BILL 1935

Motion (by Senator Brennan) agreed to-

That leave be given to introduce a bill for an act to amend the Copyright Act 1912-1933.

Bill brought up and read a first time.

page 401

CARRIAGE BY AIR BILL 1986

Motion (by Senator Brennan) agreed to -

That leave be given to introduce a bill for an act to give effect to a convention for the unification of certain rules relating to international carriage by air. and for other purposes.

page 401

INVALID AND OLD-AGE PENSIONS BILL 1935

Bill received from the House of Representatives, and (on motion by Senator Sir George Pearce) read a first time.

page 401

LOAN APPROPRIATION (UNEMPLOYMENT RELIEF) BILL 1935

Second Reading

Senator Sir GEORGE PEARCE:
Minister for External Affairs · Western Australia · UAP

[5.0]. - I move -

That the bill be now read a second time.

The principal object of the bill, which is to amend the Loan Appropriation (Unemployed Relief) Act 1934, is to provide for an additional appropriation of £531,000 for the purpose of relieving unemployment. The principal act appropriated a total sum of £1,533,750. The additional appropriations included in this bill amounting to £531,000, increase the total appropriation in the act as amended to £2,064,750.

The bill provides for the granting of financial assistance to the States for afforestation to the extent of £322,000, and for the expenditure of £9,000 for this purpose in the Federal Capital Territory. Except in the cases of South Australia and Tasmania, assistance is to be granted by the Commonwealth on a £1 for £1 basis. As South Australia is already spending a considerable amount on forestry, and the amount to be made available by this bill is not very large, the Commonwealth did not insist on a like contribution by the State. As regards Tasmania, £5,000 is the limit to which the Tasmanian Government felt it could contribute towards this scheme. The amount to be provided by the Commonwealth for each State, and the States’ contribution, are as follows: -

The general principles and conditions of the scheme of assistance include the following: -

To provide reproductive employment, which will be in addition to other measures for re-employing men, and will ultimately contribute to an increase in the national wealth;

Funds made available under the scheme are to be supplementary to those funds normally provided by the State for afforestation;

Of the total amounts provided by the Commonwealth and the State, 20 per cent, is to bc used in absorbing in employment youths under 21 years of age.

The scheme is to be administered by a trust consisting of two or more trustees, one of whom is to be appointed by the Commonwealth. This is similar to the scheme to provide assistance to the metalliferous mining industry. In explaining the variations in the amounts which the bill appropriates for assistance to the several States, I may say that the Commonwealth has agreed to provide money only in respect of forestry work over and above the ordinary State programme. As some of the States already have in hand extensive forestry programmes which do not admit of any immediate substantial increase - South Australia is already spending £150,000 per annum on this type of work - the amounts in the bill represent the sums which the States can utilize in addition to those moneys which they are finding for their usual forestry work. The assistance proposed in the bill is to cover a period of one year. The continuance of assistance on these lines in a second and third year will be reviewed when results of the first year’s work become known, by which time the

Commonwealth will be in a better position to gauge the extent of the funds which can be made available for this and other forms of employment assistance.

The principal act included as one of its provisions an appropriation of £200,000 for relief works under federal departments. The present bill provides for an additional amount of £200,000 to be appropriated for the same purpose. The manner in which this amount will be expended is indicated in the schedule to the bill, from which it will be seen that the amount is allocated for works and services of the various departments as under -

The works for which the amount of £200,000 is being provided are of an essential character, and thus the provi-sion will meet essential needs of the departments, whilst at the same time providing a further substantial amount for the relief of unemployment.

The principal act appropriated £50,000 for assistance to the metalliferous mining industry in the Northern territory. Since that act was passed by Parliament consideration has been given to the desirableness of assisting and developing the metalliferous mining industry in Papua. The Papuan Government is not able financially to assist the industry, but the discovery of a payable field would be of considerable benefit to the territory. The mining industry in New Guinea gives employment to over 500 Europeans, but the industry in Papua provides for 58 only. The extension of mining activities in the territories would provide a field for future employment, and, no doubt, if that, field were open a number of Australians would find employment there. To show the effect of the discovery of gold in these two territories I may mention that owing to the production of an immense quantity of gold in New Guinea, that territory is able to carry <on without any financial assistance from the Commonwealth and is even able to show a surplus in its accounts.

Senator Payne:

– It always has done that.

Senator Sir GEORGE PEARCE.No. In Papua, on the other hand, there is provision this year for a subsidy of over £40,000, but there is little doubt that if assistance can be given to prospecting there new fields will be discovered and the development of those mining areas will greatly improve the financial position of the territory.

The bill provides for £5,000 to be appropriated for this purpose, and this amount is being diverted from the £50,000 appropriated in the original act for the mining industry in the Northern Territory.

It will be of interest to honorable senators to note the total extent to which assistance has been given during this financial year for the relief of unemployment, including the provision in the bill now before the Senate. Since the beginning of the current financial year the total sum of £6,514,253 has been provided for works expenditure (including the provision in this bill). This total is made up. as follows : -

The provision of this amount of £6,500,000 is a very important contribution towards the relief of unemployment, constituting as it does an increase of more than £4,000,000 over “the actual total works expenditure during the previous financial year.

The appropriations already passed have very materially contributed to the reduction of unemployment throughout Australia, and it is thought that the additional provision for which parliamentary authority is now sought in this bill, will further assist in this direction. The works will be proceeded with as soon as necessary plans can be completed, and will assist in providing winter relief employment. I have obtained the latest trade union figures dealing with unemployment in the fourth quarter of 1934. The percentage of trade unionists unemployed is given as f follows:- Commonwealth, 18.8 per centi; New South Wales, 23.5 per cent.; Victoria, 15*3 per cent.; Queensland-, 9.1 per cent.; South Australia, 23 per cent.; Western Australia, 16.3 per Gent.; Tasmania, 17 per cent. Corresponding figures at the peak period of unemployment in 1932, namely, the second quarter, show that, as far as the Commonwealth is concerned, there has been a reduction of 11.2 per cent, in unemployment. In the 1932 period the number of trade unionists out of work was 124,068, as compared with 80,097 as at December, 1934, the reduction in the latter period being 43,971. While it is a matter for regret that so many workers are unemployed, it is satisfactory to know that the number is decreasing and that in the two-year period mentioned there has been a substantial improvement.

Senator Payne:

– Can the Minister say what amount is provided for the employment of youths?

Senator Sir GEORGE PEARCE:

– There is provision for an expenditure of 20 per cent, of the total sum for employment of youths.

Senator Sampson:

– Did I understand the Minister to say that Tasmania can only avail itself of £5,000?

Senator Sir GEORGE PEARCE:

– No ; Tasmania can find only £5,000, but the Commonwealth is contributing £25,000, whereas in other States the contribution is on the £1 for £1 basis.

Senator BARNES:
Victoria

.- Since this is a measure to provide money for the purposes of employment, I do not dosire the adjournment of the debate. My purpose rather is to ensure a speedy passage for the bill. My only regret is that the amount to be made available is not very much larger, because unemployment in Australia is extremely grave. I see no possibility of a return to prosperity until more of our people arc again in regular employment. I do not quite agree with the figures with regard to the unemployment situation quoted by the Leader of the Senate, because I feel sure that the information gathered by the statistician does not disclose the real situation. I admit that the statistician does his best to inform the people of Australia of the number who are out of work in this country, but the fact remains that some industrial organizations do not submit returns to the statistician and those that do furnish information are not in a position to give precise details of the number of their members who are unemployed.

Senator Sir George Pearce:

– The census figures are approximately the same as the trade union returns.

Senator BARNES:

– At the present time my union has a membership of about 60,000 as compared with a membership a few years ago of 150,000. The decline in numbers is due to the fact that so many men belonging to it are out of work and cannot afford to buy their tickets. Therefore, it is really impossible to state exactly how many of our members are employed and how many are without work.

I have studied the census figures carefully, and I find that in Victoria alone there are 93,000 people who have no income at all, 262,000 earn up to £52 a year, and 161,000 have an income of £103 a year.

Senator Herbert Hays:

– Do those figures include juvenile workers?

Senator BARNES:

– I do not know.

Senator Sir George Pearce:

– They include everybody who was working at the time of the census.

Senator BARNES:

– The unemployment figures reveal an appalling situation, and force me to the conclusion that there is no possibility of a return to prosperity in Australia until many more of out people are again working. I am not blaming any government for the present lamentable state of affairs, but it is the concern of this Government to do what is possible to improve the situation. Persons unemployed for any length of time have practically no standard of living.

The Leader of the Senate mentioned that some portion of the money would be set aside for afforestation in the various States. That is a sound proposition. In all the States useful work is being done in this direction. In the Ballarat district the Water Commission has a large timber reserve and although the chairman of the Commission informed me some time ago that the expenditure on it had been heavy, he assured me that when the trees reached maturity and were marketable, the amount realized would show a handsome profit. We read from time to time in our newspapers articles emphasizing the need for a vigorous forest policy due to the destruction of vast areas of our virgin forests and warning us that unless* timely action is taken, Australia one day. will be obliged to import hardwoods. It has always seemed to me to be stupid to neglect our opportunities in this direction, particularly in view of the fact tihat we have immense areas suitable for the growing of excellent timber. It is said that we cannot get the money to employ our people ; but I have stated frequently, and I repeat now, that any government which makes up its mind to do so, can find employment for everyone of them by using the credit of the nation for the purpose. It is time that some legislative body blazed the track. Unfortunately, we are content to carry on with an old machine which is worn out. Are we so stupid that we are unable to apply the labour available to the lands of this country in a way which would not only provide food for the workers, but, in addition, revenue for the Treasury? If the policy which I have outlined were followed, there would, before long, not be an idle man in Australia. It may be said that such a policy has never yet been tried. I agree. The Labour party wants to try it, because it believes that only by the adoption of such a policy can we hope to escape from our present difficulties.

I should like the Leader of the Senate (Senator Pearce) when replying, to say whether there is, either in the principal act or in this bill, any provision that the money proposed to be allocated to the States, or other authorities, shall be expended only in the employment of men at award rates and conditions. The Scullin Government made that a condition of every grant to the States, or to municipal or other semi-governmental bodies. If that provision is made, I have no objection to the bill. Indeed, I would cheerfully vote to double, or even treble, the money proposed to be expended.

Senator PAYNE:
Tasmania

– I am glad that the Government has seen its way to introduce a bill to amend the Loan Appropriation (Unemployment Belief) Act of last year by providing a larger sum of money for the purposes outlined in that measure. Honorable senators who heard the Leader of the Government (Senator Pearce) this afternoon must realize that the wise and discriminate expenditure of the money provided by this measure will do a great deal to grant relief to those who, unfortunately, are now out of work. The money voted last year is to be supplemented by a further expenditure of. £531,000.

I was interested to find that provision is made for the development of the mining industry in both the Northern Territory and Papua, but I regret that Papua is to be assisted at the expense of the industry in the Northern Territory. I should like to have seen the full amount of £50,000 made available to the Northern Territory to assist in the discovery of new mineral deposits there and the development of areas which have already been located. About eighteen months ago, I was at Tennant’s Creek when the gold rush there began. From what I saw then, and have learned since, 1 have no doubt that, in course of time, Tennant’s Creek will be a prosperous gold-field. The expenditure there of an additional £10,000, or even £50,000, subject to the condition that it be expended with discrimination, would be justified.

Considering the handicaps which it has had to face, Papua has done well. One cannot fail to recognize the magnificent work which has been done there under the wise administration of the Lieutenant-Governor, Sir Hubert Murray. He is indeed a marvellous public servant. In a report from Papua some time ago, I noticed optimistic references to the possibility of further mineral development, provided additional finance were made available to allow of the systematic prospecting of certain areas being undertaken. The Leader of the Senate mentioned that in the Mandated Territory of New Guinea the discovery and exploitation of wonderful gold-fields to the west, of Edie Creek, Bulolo, and other localities, had enabled that territory to carry on without any financial assistance from the Commonwealth. Had it not been for the opening up and development of those gold-fields, we, in this Parliament, would have been called upon to provide large sums of money for that territory during the last four years. Just when the revenue from the export of copra failed because of the low price of that product, the export duty on gold providentially came to the rescue and compensated the administration there for the entire losses incurred in connexion with the export of copra. So successful has gold-mining been in New Guinea that the people there have been able to carry on without being unduly harassed by excessive taxation. The Mandated Territory of New Guinea has probably the lightest taxation of any country south of the line. If such satisfactory results can be obtained in that mandated territory, it is reasonable to suppose that in Papua, across the border line valuable deposits of gold also exist. The only thing which has prevented the administration there from carrying out a systematic prospecting policy has been the lack of funds. The money proposed to be allocated to Papua under this bill will be of great value in that direction. I hope that, if its expenditure brings about satisfactory results, the amount now to be allocated will be supplemented next year by a larger vote.

Probably the most important provision of the bill is that which has to do with the allocation of money to be expended by the States in afforestation. The Commonwealth could not assist a more laudable undertaking. Honorable senators know of the enormous losses which have been caused through the erosion of the land due to the decimation of our forests. During recent years, the result of thaterosion has been most marked. Enormous sums of money have had to be expended in order to provide relief to people whose holdings have been damaged or destroyed by floodwaters. That damage would not have been caused had it not been for the destruction of our forests. I refer now, not to the ordinary clearing of forest lands, but to the damages of bushfires. In any policy of reafforestation it is necessary to provide that the money shall not be wasted because of failure to take the necessary precautions against bushfires. I could take honorable senators to forest areas where large sums of money have been spent for nought, because, after the trees had been growing for some time, they were entirely destroyed by bushfires. The Leader of the Opposition (Senator Barnes) referred to the forest reserves in the vicinity of Ballarat. Those forests will be a success because, not only has there been a wise selection of trees, and systematic planting, but also an efficient patrol system and proper precautions against the destruction of the timber by fires. If we spend £500,000 in reafforestation, and fail to take precautions against fires, we might, possibly, just as well throw the money into the sea, except that in the planting of the trees unemployment would be relieved. A policy of afforestation must bring permanent and beneficial results to the Commonwealth, provided that policy is accompanied by wise provision for the protection of areas after planting and during the growing period. I am glad that in this bill a stipulation is made that 20 per cent, of those to be engaged shall be youths who are unemployed at the present time. That will afford at least a certain measure of relief. I think, however, I might be pardoned if, while expressing approval of the policy of the Government, I urge upon it the absolute necessity of going much further in its effort to deal with the problem of unemployed youths. I urge the Government to realize that, up to the present, it has not done all that is possible and all that many people expected of it. Because of the greatness of the problem, it is absolutely essential that the Commonwealth should cooperate with the States at the earliest possible moment in an endeavour to evolve a scheme which would result in the employment of the whole of our unemployed youths.

Senator Brown:

– The honorable senator would not send them to The Granites gold-fields?

Senator PAYNE:

– I would have no objection to sending the right type of youths there under proper conditions. I have some knowledge of this country. But all boys are not alike; some make good in a certain avocation while others fail in it. It is apparent that something must be done to prevent youths . growing up to manhood in idleness, and unless we do that speedily this country will suffer for many years as a result of our neglect. I do not care whether provision is made for their employment by governments, commissions, or individuals. The main consideration is that they shall be employed.

Senator Brown:

– The honorable senator is not in favour of conscription of labour.

Senator PAYNE:

-I refuse to be sidetracked . by the honorable senator. I repeat that it is essential that occupation be found for these lads during the critical period of their lives. Unless something of this kind is done, anything might happen in Australia. The vital statistics show the alarming position to which this country has drifted. I do not say that it is entirely due to the unemployment of so many of our youths, but their inability to get work is a contributing factor to that position which, if it is allowed to continue, will result in our being down and out within the next 40 years. That factor must be dealt with. I support the bill.

Senator J V MACDONALD:
QUEENSLAND · ALP; FLP from 1932

– My objection to this bill is that the increased provision that it makes for the relief of unemployment should be much larger than it is. Last year, when the unemployment figures were furnished by the Commonwealth Statistician, they were so alarming that I was inclined to doubt my own arithmetical calculations; but time has shown that they were right. On the publication of these returns, the Melbourne Age, which is not a Labour newspaper, made the following comments: -

It is surprising to discover that, when the census was taken in June last year (1933), the position in Australia was relatively more aente than in Great Britain. Our unemployed then, despite some evidence of improvement during the preceding year, totalled 481,044, or 22.4 per cent. of the working population ; . the comparative British figure was 19.4 por sent. Since then further improvement has occurred, and the official estimate for August of this year was 380,350 unemployed, equivalent to 18 per cent.

These figures are alarming. As Senator Barnes has said the official figures regarding unemployment do not accurately disclose the true position. As a matter of fact, great difficulty is experienced in the compilation of reliable returns and unemployment is really much greater than the official figures would lead us to believe. As I have emphasized before, the only way to improve the employment position is to adopt a vigorous policy of public works. [Quorum formed.”] I regret that so many honorable senators absented themselves from the chamber during the time when Senator Payne was speaking, and I intend to insist upon a quorum being present, especially as honorable senators opposite have just thrown out two honorable senators who sit on this side of the chamber.

Senator Sampson:

– They threw themselves out, and the honorable senator knows it.

Senator J V MACDONALD:
QUEENSLAND · ALP; FLP from 1932

– The Leader of the Government did not endeavour to understand Senator Dunn. I admit that the honorable senator is a difficult man to handle, but honorable senators opposite should have been satisfied with his head instead of demanding also the head of Senator Rae.

The PRESIDENT (Senator the Hon. P. J. Lynch). - The honorable senatoris not in order in reflecting upon a vote of the Senate.

Senator J. V. MacDONALD.Twentysix out of the 36 members of the Senate belong to either the United Australia party or the United Country party. They should endeavour to keep a quorum present. Especially is this so, having regard to the fact that they voted to throw out two good Labour men from this side of the Chamber who areregular in their attendance and are always pro pared to discuss fully and fairly whatever business comes before the Senate.

The PRESIDENT:

– Order ! The honorable senator is not discussing the business before the Senate.

Senator J V MACDONALD:
QUEENSLAND · ALP; FLP from 1932

– I noticed that the Senate thinned out while Senater Payne was speaking. The honorable senator was not able to retain a quorum, although he was discussing the subject of unemployment, which is covered by this bill. This shows the hypocrisy of our friends opposite.

The PRESIDENT:

– Order !

Senator j. V. MacDONALD.Honorable senators opposite show a lack of appreciation of the seriousness of the position of the unemployed when, after putting two honorable senators of the working class on the unemployed list, they are not prepared to keep a quorum present while the important subject of unemployment relief is being debated by one of their own party.

The PRESIDENT:

– I am waiting for the honorable senator to connect his remarks with the bill.

Senator J V MACDONALD:
QUEENSLAND · ALP; FLP from 1932

– The question of unemployment is of paramount importance and its relief is the main feature of the bill. The Commonwealth should pursue a vigorous policy of public works as has been done in Queensland. [Quorum formed.] In that State the public works policy has been considerably enlarged and we, on this side, advocate that in these stressful times the Commonwealth should follow the lead of the Queensland Government and put its own house in order. The last quarterly return of Australian statistics shows that while the unemployment figures for the Commonwealth average 18.8 per cent. the figures for Queensland are only about half of that percentage. In other words, Queensland is giving an object lesson to the whole of Australia. According to Mr. Forgan Smith, the Premier of Queensland, the improvement in employment in that State has been brought about by the provision of large sums of money for public works.

The other States could well adopt a similar policy. If there were less jealousy between the States a greater number of public works could be undertaken even under the present restricted Commonwealth policy. When travelling through South Australia and Western Australia recently I noticed large numbers of unemployed. Yet Senator Foll, a little while ago, declared that he would not support a proposal for the expenditure of £2,000,000 of Commonwealth money in South Australia to convert the East- West railway line to the standard gauge of 4 ft. 8½ in.

Senator Foll:

– I said that I would not support a scheme for the general unification of railway gauges.

Senator J V MACDONALD:
QUEENSLAND · ALP; FLP from 1932

-The South Australian Government has expressed opposition to the proposed expenditure on the Bed Hill to Fort Augusta railway on the ground that it would cause a loss of State railway revenue; but the Commonwealth Government should go on with this work, which is not a general unification.

Senator Foll:

– The money could be spent to better advantage on roads and bridges in North Queensland.

Senator J V MACDONALD:
QUEENSLAND · ALP; FLP from 1932

– The Queensland Government is doing a good deal in that direction. Although I welcome the proposed expenditure, I consider that the amount to be appropriated should be larger. Many public buildings are out of date. I recently inspected the post office at Goulburn, which was built about 40 years ago when post offices were under the direction of the State authorities. It is a better building than the central portion of the present Brisbane post office. We see old and ramshackle government buildings in Sydney that are a disgrace to that State. It is quite true, as Senator Brown remarked, that opponents of the Labour party take the miserly view that money should not be spent on public works, . despite the shocking conditions under which the unemployed exist. We contend that millions, more than are now being spent should be made available. It is intolerable that single men should be reduced to the position of having to live on 10s. a week, while married couples each receive only a few shillings more. Tens of thousands of good Australians are living under awful conditions to-day. According to the Melbourne Age, which is not a Labour newspaper, the statistics show that, in the group of persons under the age of 21 years, no fewer than 22,711 have failed to obtain any kind of employment. They have never hada job in their lives ! Yet our opponents are apparently satisfied with the present conditions. There is no doubt that a solution of this difficulty will eventually be forced upon us. Capitalism will cut its own throat in the end. Recent cablegrams suggest that a war will bring about another disaster, and, instead of having one bolshevik state in Europe, all the big nations will attempt some form of socialism. The people, in their desperation, will end the evil of unemployment, and their action will certainly sound the death knell of the capitalistic system.

The PRESIDENT:

– I ask the honorable senator to discuss the bill.

Senator J V MACDONALD:
QUEENSLAND · ALP; FLP from 1932

– Whilst we on this side of the chamber support the bill, we consider that a real attempt should be made to put the people back into employment and to keep them at work. We are returning to a state of barbarism. I was asked by a man who knew Germany, whether I could assist in securing the introduction of a system for the bartering of goods between Germany and Australia.

Senator Payne:

– Mr. Ogilvie will bring something back from Russia along those lines.

Senator J V MACDONALD:
QUEENSLAND · ALP; FLP from 1932

– I hope he visits Russia, because, although I do not approve of everything that has been done by the Soviet authorities, we have a lot to learn from that country, and it is hoped that the great experiment being carried out there will be successful. Unfortunately I do not think that it will be as successful as some people imagine. We have a surer means in Australia of improving the position of the masses, if the people will only awake to the need to secure a better order of society. A free, untrammelled experiment in social improvement is being carried out in Russia; but there would have been no freedom in that country if the British and French governments had sent their soldiers into Russia.

Senator Sir George Pearce:

– Under this bill no vote is made to the Soviet Republic.

Senator J V MACDONALD:
QUEENSLAND · ALP; FLP from 1932

– But we have unemployment. “When the Labour party loses the confidence of the workers, the wealthy classes represented by honorable senators opposite will disappear, and an attempt will be made to institute a new order of society.

Senator BROWN:
Queensland

– We on this side always support measures for the expenditure of public money for the development of the country and the provision of purchasing power for those who are out of employment. The Leader of the Senate, in quoting from the census returns, would have us believe that the figures do not afford a true reflex of the position. Personally, I consider the figures to be of a staggering nature, showing- that unemployment is far more widespread than it is supposed to be. Whilst it is admitted that old-age pensioners and others are covered by the statistics, I understand that a number of persons on short time were not included. This fact should be kept in mind, because many thousands of men and women in Australia, through the rationing of work, are not receiving sufficient food, clothing and shelter. Although we commend the Government for its proposal to spend an additional £531,000 for the relief of unemployment, we realize that it is impossible for the Government to solve this problem on the lines followed by it up to the present time. The members of this Parliament sit in Canberra for only a short period in each year, and if the unemployed were permitted to work on a similar basis the problem would be solved. I have no doubt that the time is approaching when unemployed persons will not be penalized because of their misfortune, but will be paid for their leisure time. All unemployed men and women should be paid a weekly amount to enable them to live in comparative comfort instead of having to take the dole. The present Government has not seriously tackled this problem. An honorable member in the other branch of the legislature has declared that there will always be 200,000 unemployed in Australia. I hope that honorable senators do not hold that view, although members of the tory government in Great Britain have declared that it is impossible to solve this problem. Senator Payne is a member of a party which considers that this evil cannot be eliminated.

Senator Payne:

– Show me a plan by which the problem may be solved, and I shall give it my support, irrespective of party considerations.

Senator BROWN:

– The method adopted by the Government is paltry in the extreme, having regard to the magnitude of the task. There has never beeu a period in Australian history when we have produced more of those commodities which the people require. Notwithstanding the wealth which this country produces, thousands are in need, but all that this Government can offer is a paltry £500,000 to be expended chiefly on afforestation. An afforestation policy should be proceeded with vigorously because owing to the greed of certain persons many of our forests have been completely denuded, thus bringing about, erosion which has cost the country millions of pounds. I read only the other day that as a result of huge duststorms in the United States of America, caused largely by the destruction of timber, many farms had been wiped out. According to one authority, the land will not be productive for possibly a hundred years.

Senator Payne:

– This Government has done more to relieve unemployment than the Government which the honorable senator supported.

Senator BROWN:

– I was not a mem-: her of this Parliament when the Scullin Government was in power. I do not propose to compare this Government with any Labour government, but I say, emphatically, that the methods now being pursued will not assist the Commonwealth to overcome its economic difficulties, or solve any of the pressing problems which now confront it.

Senator Payne:

– Does the honorable senator suggest we should go further?

Senator BROWN:

– I know that Senator Payne is anxious to help in the solution of these problems, but the party with which, he is associated is not likely to give him a lead. I was pleased to hear the Leader of the Government (Senator Pearce) say that in Queensland the percentage of unemployment is only 9.1, which is probably lower than that of any other State, due largely to the fact that that State is controlled by a Labour government. The amount to be appropriated under this bill for expenditure in Queensland is smaller than that to be expended in New South Wales, where an anti-Labour government is in power.

Senator Grant:

– The people of the Commonwealth have been bled to assist Queensland, and particularly its sugar industry.

Senator BROWN:

– Queensland is being bled as a result of Commonwealth taxation, as I shall show the honorable senator.

SenatorFoll. - If the honorable senator will refer to his taxation assessments, he. will find that the Commonwealth tax is not half as much as that of the State tax.

The PRESIDENT (Senator the Hon. P. J. Lynch). - I ask the honorable senator not to be led away from the subjectmatter of the -bill by interjections.

Senator BROWN:

– The Premier of Queensland, Mr. Forgan Smith, stated at a constitutional conference held in Melbourne, that in 1928-29, including the unemployment relief tax, the Queensland Government collected in that State £5,128,000, whereas the Commonwealth authorities collected £4,718,000. In 1932-33, the amount collected by the State Government was £5,587,000, and that collected by the Commonwealth authorities was £5,200,000. The Premier went on to say that the unemployment relief tax was specially imposed to meet a definite situation arising from the fact that under the capitalist system we experienced a period of deflation when we should have been prosperous. This necessitated the imposition of such a tax. Excluding that special tax, the figures quoted by the Premier of Queensland are astounding. For the financial year 1928-29, the amount collected by the State Government was £5,128,000 and that collected by the Commonwealth authorities was £4.718,000. In 1932-33, the Queensland

Government collected £3,781,000, and the Commonwealth £5,200,000. Despito the fact that the amount which the Commonwealth collects from the Queensland people has increased from £4,718,000 to £5,200,000, and the amount collected by the State Government has decreased from £5,128,000 to £3,781,000, the Government proposes under this bill to allocate only £30,000 to Queensland.

Senator Foll:

– Can the honorable senator give the amounts expended by the respective Governments?

Senator BROWN:

– The Commonwealth Government has expended most of the money it has received. Although informed from time to time that the Commonwealth has shown a surplus, the Auditor-General in his annual report states that there have not been any actual surpluses, and that there is still a deficit of £17,000,000, which has not been taken into consideration.

Senator Foll:

– Portion of the revenue collected by the Commonwealth is restored to the States in the form of invalid and old-age pensions, for which no allowance has been made by the honorable senator.

Senator BROWN:

– The Commonwealth Government has spent money in various directions, but that does not dis- pose of the fact that the amount colected by the State Government has decreased, while that raised by the Commonwealth authorities has increased.

Sitting suspended from 6.15 to 8 p.m.

Senator BROWN:

– Dealing with unemployment the Premier and Treasurer of Queensland stated recently that -

The Commonwealth does not take direct responsibility for unemployment relief, notwithstanding the fact that buoyancy of Commonwealth revenue, due to increased customs revenue particularly may mean’ an increase of unemployment in the States, owiug to the lessened demand for goods of local manufacture.

That, I suggest, is an important point to bear in mind when considering the problem of unemployment. As Mr. Forgan Smith pointed out, it may be the direot result of Commonwealth Government policy, and then, because of the difficult situation which has developed, we have the spectacle of a government which may be, to some extent, responsible for it, offering relief by way of grants or subsidies for expenditure by State governments.

I ask the Leader of the Senate and his supporters how do they expect to overcome the unemployment problems that confront us. It is absolutely impossible by the adoption of these methods for this Government to provide a solution. In recent years the Commonwealth and States’ public debts have been increased, and apparently the Ministry and its supporters expect us to get over our troubles by getting further into debt! Can any Government supporter offer any ray of hope if the Government proceeds along these lines, instead of bringing forward practical proposals, to overcome our difficulties? I shall be glad if they can show the benighted Labour representatives on this side of the chamber how, by these methods, they expect to achieve their purpose.

I do not wish to delay the passage of this bill, but I feel strongly on this matter, and cannot allow this opportunity to pass without giving expression to my views on the subject. I believe that we have reached a stage in our economic development which requires us to consider whether it is possible, under the present world system of capitalism, to overcome our economic trouble by the adoption of a temporary expedient. In other words, I believe that world capitalism has reached a stage of development which precludes the possibility of a solution of the problem which to-day confronts all the nations.

Senator Herbert Hays:

– “What is the alternative to the proposals submitted by this Government?

Senator BROWN:

– I shall endeavour to satisfy the honorable senator on that point before I resume my seat. My present purpose is to make clear to Government supporters if I can - I know that my friend, Brian Penton, has accused me of talking in Scotch and thinking in Dutch - that modern capitalism, as a system of development, has been responsible for such a rapid expansion of trade throughout the world that we have now reached the stage where expansion is on the decline, and it is impossible for certain avenues of investment to be utilized with profit. The consequence is that nations are now being forced back upon themselves to find a way out of their commercial and industrial troubles. Therefore, it follows that if this important avenue is closed to investment those responsible for the direction of government policy must turn to a vigorous policy of public works as the only alternative. On this point I notice that Mr. Davidson, the general manager of the Bank of New South Wales, is in agreement with me, and I may add that Mr. Forgan Smith, the Premier of Queensland, who has made a deep study of the economic situation, takes every opportunity available to him to utilize money at. a reasonable rate for the intensive development of that State. The result of his policy is seen in the unemployment figures for the fourth quarter of 1934, quoted this afternoon by the Leader of the Senate, who pointed out that the greatest improvement was shown in Queensland where unemployment was now down to 9.1 per cent. It is incontrovertible that the improvement of the position in Queensland is the direct result of government policy. I know that critics of “that State will put to me the question - What about the future? They will say that a day of reckoning will come; that, eventually, it will be impossible for the people to meet the interest bill for government expenditure upon public works, and that despite the present stage of development, the last state of Queensland will be worse than the first. That is the argument that will be advanced by our critics. I would, however, remind them that we have to deal with the situation as we find it, and that since there is no other avenue for the profitable investment of money, the only alternative is the adoption of a vigorous public works policy. Can any government supporters point to any particular industry in which they would care to invest their capital at the present time? I am sure that they would not invest money in wheat production, and I doubt that they would invest in wool. Obviously, the manufacturing industries are apprehensive that as a result of the visit to Great Britain of the Prime Minister (Mr. Lyons) to conduct negotiations with British Ministers and manufacturers there will be a diminution of their activities in the near future due to a lowering of the tariff barrier in respect of many items.

If we are to deal intelligently with unemployment we must take full cognizance of the development that has taken place under the existing capitalistic system in other countries. We must bear in mind that, as their difficulties are as great, perhaps, as our own, they are closing the avenues of trade in the hope that, by so doing, they will improve their position. Mr. Bruce has something interesting to say on this point. Speaking on the 6th March, 1935, at a meeting of the Institute of Chartered Accountants, in London, he said -

Politicians can never successfully handle the question of complementary trade which is now in the hands of the commercial leaders of the country. Complementary trade to-ds,y bore not the slightest relationship to one of the most ghastly menaces in existence - the theory of compensation agreements which wag rife throughout the world.

That is the sort of theory which this Government is attempting to put into practice per medium of trade agreements with other countries, such as the trade agreement with Belgium in regard to glass. Mr. Bruce, the elect of the Tory party, and for many years a Prime Minister of Australia, makes a damaging admission. If he is right, then clearly the proposals being brought forward by this Government are doomed to failure. Mr. Bruce and many other students of the present world economic situation are convinced that the world has reached such a stage of productivity that nations are being forced back upon themselves in order to solve their unemployment difficulties.

What has the present Government done to meet the situation that confronts us? Apparently it is obsessed with the idea of trade agreements with other countries. But that alone, as I have shown, is no remedy. And certainly the appropriation of a few hundred thousand pounds will not take us very far along the road to national recovery. Our friends among government supporters will ask what suggestions we have to make to meet this situa- tion. I tell them that we approach its consideration with the knowledge that capitalism and international trade are on the decline. Therefore we seek a solution of our unemployment problem by some internal adjustment of our social system.

The United States of America is trying out a number of experiments. President Roosevelt has for two or three years been invested with more power than has been given to any other President of that great republic. He has offered the people a new deal based upon the National Recovery Act, and by the adoption of certain radical legislative machinery he has introduced into industry the system of the minimum wage with a view to increasing the purchasing power of the people. Trade unions are now recognized in that country, and he is endeavouring to compel leaders of industry to treat their employees decently in the hope that, by these means, the problem in America may be solved. But so great is the money power there that it is impossible, under the present system, to achieve that purpose. A few years ago, President Hoover declared that America must have avenues overseas whereby its goods could be exported in huge quantities, in return for which, as interest, it would take only small quantities of goods from other countries. That would, no doubt, relieve the situation in the United States, but President Roosevelt has discovered that it is impossible to persuade other countries to take American goods on such terms. On the contrary, foreign countries are closing their doors to trade in the hope that, by so doing, they may ease the difficulties of their own people. The same course is being pursued by Australia. t Only today we heard the argument that, because of our adverse trade balance with the United States of America, we should out down our imports from that country and give our custom elsewhere. Mr. Bruce has described that as a “ ghastly menace “ to trade relationships. President Roosevelt has been endeavouring to raise the standard of living for the people in the United States of America by spreading the purchasing power of the wage-earners. But he started at the wrong end. The purchasing power of the people in the United

States of America is less to-day tb.au it was before the passing of the National Recovery Act. Although he established a minimum wage in industry, because of the greed of employers the minimum wage tends to become the maximum. He also reduced the hours of labour, but, in doing so, he also reduced the wages of labour, with the result that purchasers are to-day taking off the market less than they were prior to the adoption of the National Recovery Act. It is true that, in some respects, there has been an improvement in the industrial situation in the United States of America, but, for the most part, the people there are, to-day, in a worse position than they were a few years ago. In many respects, the act has been ineffective. Take for example the position of the farmers. Under governmental direction, they reduced the acreage, and destroyed stock. They were paid to produce fewer pigs and cattle, and less grain, and other commodities, and for destroying areas under cotton. But what was the result? The farmers took the money, and, like sensible people, bought fertilizers .with it, and produced greater quantities of cotton and other farm products from a reduced acreage; As a result of the increased use of fertilizers by the American farmers, more cotton was produced, although the area planted was less. The United States of America is in a serious economic position to-day, because the people of that country do not yet understand the problems confronting them. Every increase of productivity should be accompanied ‘by an increased purchasing power on the part of the people. We are told that the Government has a scheme for the rehabilitation of rural industries, and the adjustment of the debts of farmers. Wheat farmers owe £140,000,000. The honorable member for Gwydir in the House of Representatives (Mr. Abbott) says that the wool-growers of Australia owe about £150,000,000 and that other producers owe £200,000,000 more. What hope is there ‘ of solving the problem of the debts of the primary producers by making available the sum of £12,000,000? Is it possible by measures of this kind to overcome the gigantic problems which con front us? Before we can solve those problems there must be a reorientation of the whole economic system in order to equate our distribution system to our system of production. Until those who are in power in this country see the problem from that point of view, it will not be solved. We cannot alleviate the position of the farmers until we take deliberate steps to see that with every increase of productivity we make it possible to distribute more goods to the people. While we -on this side are prepared to support the Government in every effort it makes to ameliorate the lot of the people, we realize that these efforts are, after all, only palliatives.

I agree with the proposal to go ahead with a scheme of reafforestation, and I urge the Government to follow the example of Queensland by stipulating that every man working in the forests shall receive award rates. In New South Wales and other tory centres, the authorities are taking advantage of the poverty of the workers to place them in camps and pay them about 30s. a week. I agree with my Leader that if the Commonwealth Government allocates money to the States it should see that the workers employed by the expenditure of that money are given a square deal, and are paid award rates for their labour. If advantage is taken of their poverty to reduce their rates of pay, their purchasing power is not increased, and consequently the country is unable to overcome its problems. It is not sufficient to increase production. Improved methods of production necessitate also the giving to the producers of sufficient purchasing power to enable them to buy those things which they have produced. I believe that this nation could be roused to deal with this problem as it was roused during the war. Even though there is a diminution of exports from this country because of the competition of Denmark, the Argentine and other countries, we should so organize things in this country that we shall be able to employ our people in such a. way that they will use their labour power for the general development of Australia, and the increasing of the economic status of its people, so that every person in the community shall be economically as well as politically free.

Senator Payne:

– What is the condition of the people in Russia ?

Senator BROWN:

– I have received from various- people a number of books and magazines which purport to give a true account of conditions in Russia. It would appear that the difficulty there is not the finding of wort for the people, but the shortage of technicians and craftsmen to carry out the works decided on.

Senator Payne:

– Russia’s difficulty is that of feeding its people.

Senator BROWN:

– In the past, that has been a problem in Russia ; but recent reports show that, as a result of an intensive agricultural policy,, the difficulty is less than ever before.

Senator Payne:

– I would not like to see the standard of living in Australia reduced to1 that of Russia, where they can carry on only by maintaining a low standard of living.

Senator BROWN:

– I admit that the standard of living in Russia is lower than it is in Australia. Immediately after the war Russia was surrounded by enemies, and, in addition, there was trouble internally between the White Guards and the Bolsheviks. Russia found it necessary to con-vert to an industrial state a nation 90 per cent, agrarian. No impartial man who knows of the terrific struggle of the people of Russia will deny that its people have worked wonders. Although the standard of living in that country is not high, I gather from books which have been sent to me - books banned by the present Government - that there is an everincreasing amount of wealth going into the hands of the common people who produce it. There is also a reduction of working hours. If Russia continues along the lines that it has been following, I predict that in less than ten years that- country will have reached a position equal to that of England or America. Russia is going forward while other countries are slipping back. Magazines which I have received from Russia contain photographs of the huts occupied by the unemployed in Australia, and accounts of ex-soldiers and others dying because of malnutrition. Honorable senators opposite may smile, but they cannot deny that in this rich country, which contains an abundance of food, there are between 300,000 and; 400,000 workers unemployed, and many people on the verge of starvation. In the light of those facts; why sneer at Russia? Mr. Lyons,, accompanied, by several Ministers and a small- army of officers, is now in England trying to make arrangements with the authorities there for the disposal of Australia’s surplus* meat production. Various proposals to overcome the difficulty have been made’; some advocate a quota, others a tariff, while- still others say that the agreements with the Argentine and Denmark must be kept. Two years ago, when I predicted that Australia would have trouble in disposing pf its wheat, ex-Senator Colebatch disagreed with my view ; but my prediction came true in less than two years. Only the other day the Acting Prime Minister (Dr. Earle Page) said that there was a possibility of the British Government restricting importations of butter from Australia. What is the Government doing about that matter? What can it do about it ? Parliament meets for a few weeks and passes a few measures; but nothing of any real- value is accomplished. Instead- of sneering at other countries, we should try to understand them. For that reason any literature dealing with other countries- instead of being banned, should be encouraged. I should like to know, for instance) what Hitler is doing to meet the economic position of Germany, and what Mussolini is doing in Italy to solve the problems of that country. Books dealing with such subjects might help u? in the solution of our problems. We should welcome all the information that we can get. Honorable senators opposite may sneer, but I and my comrades are deadly sincere, when we say that before long this Senate will have to take notice of facts. The wealth of this country must be so controlled that every man, woman and child in the community will have not only the necessaries of life, but also a share of the best that this country can give to them. Instead of legislating for the benefit of the people as a whole, tha Government is pandering to the few. Until we have sufficient courage to tackle the problems confronting us we shall, T suppose, continue to discuss the expenditure of a few thousand pounds here and a few thousand pounds there; but we shall not get to the root of the trouble. We on this side accept what is offered in this legislation, and hope that it will bring some measure of comfort into the homes of the people, by giving purchasing power to those who now cannot buy because they are out of work, and have no money.

Senator DUNCAN-HUGHES:
South Australia

– I should like to go into the interesting questions raised by Senator Brown, and give my views as to how the people invest their money, and why; and also to discuss whether or not capitalism is on the decline, even in Russia.

Senator Sir George Pearce:

– Capitalism is growing in Russia.

Senator DUNCAN-HUGHES:

– Yes. Great, however, as the temptation is to discuss those questions, I shall not do so to-night.

I do not propose to discuss in detail the provisions of this bill. I am glad that it contains a provision for a small grant to Papua to assist the mining industry. In December last, I suggested that Papua might have been included in the main bill, and the Leader of the Senate (Senator Sir George Pearce) then said that he would see what could be done. I take it that this is what is now called the implementation of that promise.

Coming to clause 9, which provides for assistance to the States for purposes of forestry, I want to raise a point for the consideration of the Government, and, at the same time, I want it to be understood that in no sense do I look a gift horse in the mouth. As I understand it, the Commonwealth has allocated £17,000 to South Australia without stipulating that the State shall spend a corresponding amount. The Leader of the Senate, in introducing this hill, mentioned that South Australia was already providing £150,000 this year for the promotion of forestry. I suggestthat the amounts in respect of forestry which the States have already provided in their own Estimates might fairly be taken into consideration in deciding the extent of the assistance to be provided by the Commonwealth. For instance, I do not know what amounts the States of Victoria and New South Wales have provided on their

Estimates for the purposes of forestry, but, under this bill, those States are each to receive £100,000 on condition that they expend a similar amount; while South Australia, which has already provided £150,000, is to receive only £17,000. As I have said, a fairer way of dealing with this matter would have been to take into account the sums which- the States had already arranged to spend during the year on forestry, and not what additional sum they were prepared to spend over and above the amount which had already been voted for that purpose.

I am glad that in this bill some effort has been made to provide employment for our young men. That action must commend itself to all honorable senators. Although the stipulation has been made that only 20 per cent, of the number to be employed shall be youths, it is, at least, a move in the right direction. I am also glad, with a qualification, to notice that it is intended to make grants to all States, for all purposes, to ah equal amount, so that they may be placed, roughly, on a population basis. I do not know that I would adhere to the population basis with regard to a question of this kind, although since the grant is primarily to deal with unemployment, such a basis offers, in some respects, a fair way of dealing with the problem. But there is this difficulty that, in the matter of forestry, the larger States, such as Western Australia and Queensland, on a population basis, get a comparatively small amount by contrast with the more closely settled States having a smaller area, such, for instance, as Victoria. Another factor which also must be taken into consideration is the suitability of the soil for forestry purposes. But the Government, it seems to me, is getting very close to the constitutional barrier against preference to States. The intention of the framers of the Constitution was obviously that there should be equal treatment of all States. Section 51a of” the Constitution Act, which governs taxation, section 99, which regulates trade, commerce, and revenue. and section 102, which deals with the levying of customs duties, provide that no preference is to be given to any one State. The general idea behind the Constitution Act is that the

States should have equal treatment; that payments should not be made according to population or area, but that all States should be treated from the point of view of the Commonwealth as being equal. And a similar point arises with regard to the objects in respect of which the Commonwealth may assist the States. I should like the Leader of the Senate to consider this point. Section 91 of the Constitution deals with assistance to the gold-mining industry. Under section 90, the Commonwealth has exclusive power to grant bounties on the production or export of goods. I am aware, of course, that under section 96 of the Constitution, financial assistance may also bc given to the States. But, under section 91, a State, with the consent of the Commonwealth Parliament, may grant “ any aid to or bounty “ on the production or export of goods, and further, may grant “ any aid to or bounty on mining . for gold, silver or other metals.” In other words, the Constitution deliberately faces only the possibility that the States may desire to make grants for the mining of gold and other metals. I do not say that under section 96 it is impossible for the Commonwealth to grant assistance for mining purposes. It may and is doing so by using the words, “’ financial assistance.” It appears to me from ray reading of the Constitution Act - and I recommend honorable senators to study it occasionally for their information, as one is apt to forget, its provisions - that it is specifically provided that, a State may provide bounty or other aid for mining, but nothing whatever is said as to the Commonwealth providing aid for that purpose. It may be urged that this has no direct bearing on this bill. That is not so, because a relatively small amount is actually provided in this bill for assistance to mining. For my own satisfaction, I should like -the Leader of the Senate to clarify the position and to lel me know if there is any other section of the Constitution Art under which this assistance can be granted, or whether the Parliament has to get back to the “financial assistance” provided for under section 96.

Senator Sir GEORGE PEARCE (Western Australia - Minister for External Affairs) [8.40]. - in reply - Senator Barnes has asked whether, in the expenditure of this money, conditions have been imposed on the States in respeot to the payment of award rates of wages. No such condition has been attached to the granting of this money to the States. The Commonwealth believes that each State Government is in a position to determine its own conditions; it is responsible to its electors, to whom it must answer for its actions. So far as Commonwealth expenditure is concerned, however, the Commonwealth will pay full award rates and offer full-time employment in the carrying out of Commonwealth works.

I do not think Senator Brown will expect me to traverse his remarks. I could not help thinking when the honorable senator was speaking that he had in mind the fact that a general election will shortly take place in Queensland. The honorable senator covered a wide range of subjects, and, having listened to him. I am inclined to agree with Senator Duncan-Hughes, -that whilst capitalism may be declining in some countries, it is definitely growing in Russia. In that country it has become necessary to readopt some capitalistic ideas in regard to the payment of different rates of wages for different classes of work.

In regard to the points raised by Senator Dune an -Hughes, preliminary action was taken at a conference between Commonwealth and State representatives, at which the States were asked to put forward suggestions as to the amount of money which they thought they could usefully spend. The amounts provided in this bill, with, I think, the exception of those provided for Western Australia and Tasmania, are those asked for by the States as being the sums which they could usefully spend in addition to those which they were already spending. The grants to the States other than South Australia and Tasmania were qualified by a condition that they should provide a similar amount. As to the question of equality of treatment, I suggest that a definition of the word “ equality “ is required. Senator Duncan-Hughes himself in the course of his remarks showed that per capita payments, in one sense, mean true equality, and, mother respects, may prove to be most unequal. For instance, it is obviously more costly to administer a State like Western Australia, with its vast area, than it is to administer a smaller State like Victoria. The stage of development reached by a State must also be considered. Obviously, a well-developed State does not need the assistance required by one that is not so fully developed, and if the Commonwealth makes the same grant to each, the grant cannot be said to have been made on the basis of equality. Everything hinges on- the -interpretation of the word “equality”. What the Commonwealth has tried to do has been to take into consideration all of these factors, including the financial resources of the States, and I think it has meted out even-handed justice. In allotting the money granted for roads, for instance, consideration is given not merely to population, but to area, and, surely, in making roads, area is the most important factor to consider. A large State must have a proportionately greater mileage of roads to construct if its population is thinly spread over the larger area.

Senator Brown:

– Why does Queensland receive only £30,000?

Senator Sir GEORGE PEARCE.Queensland gets its grant on the basis of population and area; but the honorable senator is now referring to forestry work, and I am speaking of roads. The forestry vote was distributed after consultation with the States, and after taking into consideration the work which they themselves were doing, and the sums which their experts reported could be usefully expended.

Although I agree with Senator Duncan-Hughes that the section of the Constitution which he has quoted seems to provide that the expenditure of this money is a direct responsibility of the States, the Commonwealth Parliament, under section 96, is entitled to give financial assistance to the States, and, in providing that assistance, it is not confined -to giving it for expenditure on matters which may be regarded as Commonwealth responsibilities. The Commonwealth Parliament, throughout its history, in making grants to the States, has had regard to their financial difficulties, and their stage of development in coping with particular problems. I remind honorable senators, for instance, that there have been times when the Commonwealth has made grants to the States to enable them to deal with health matters. Take, for instance, venereal disease. Although it was primarily a duty of the States to deal with all health matters, federal functions being restricted to quarantine work, yet the interests of the Commonwealth as a whole are served by raising the standard of health of the community, and assisting the States in combating a particular disease. Take also the form of tuberculosis to which miners are subjected. In some States very little mining is carried on, and this disease is not much in evidence there; but, in other States, where a great deal of mining is done, and particularly where dust is prevalent, miners phthisis is much more prevalent than in other States. The Commonwealth authorities have provided laboratories for the purpose of helping to combat this disease, and I contend that this is a legitimate use of the powers of the Commonwealth under section 96, although the money granted may not be used for a purely federal function. It may be employed for a purely State function, but the object is to raise the standard of health throughout Australia.

Senator Sampson:

– It is a national service.

Senator Sir GEORGE PEARCE:

– Yes. On these grounds, these particular provisions of the Constitution should be read together. There is always the danger, of course - and we have had evidence of it in this discussion - that the Commonwealth might use its temporary superior financial power to encroach upon the functions of the States, and interfere with their work. That would be a grossly improper use of the financial power of the Commonwealth. But, so long as we do not interfere with the administration of the grants made to the States, we shall strike the happy medium.

A suggestion was made by Senator Barnes that in making these grants to the States for the relief of unemployment we should insist upon the observance of award rate3 and conditions of labour. I consider that it would be very improper of this Parliament, in making a grant to the States for the provision of employment, to lay down the conditions which should be observed by the States in the giving of employment. That, in my opinion, would be an improper use of the Commonwealth financial power in granting financial assistance. It is for the Commonwealth to lay down its own conditions, and to leave the States to decide the way in which the money shall be spent in providing employment. So long as that is done we shall safeguard the rights of the States, and, at the same time, give them useful assistance.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate.

Report adopted.

page 418

DRIED FRUITS EXPORT CONTROL BILL 1935

Second Reading

Senator BRENNAN:
Acting Attorney-General · Victoria · UAP

– I move -

That the bill be now read a second time.

This measure has very little to do with either dried fruits or export control. If has been introduced for the purpose of ensuring to any permanent officer of the Public Service, who has ‘been seconded for appointment as secretary to the Dried Fruits Control Board, the preservation of his existing and accruing rights as a public servant during his period of service with the board. These rights are defined in section 6 of the Officers’ Rights Declaration Act 1928-1933, which provides that an officer who has been employed under some authority of the Commonwealth shall, when his employment in his unattached capacity is completed, be entitled to appointment to an office in the Public Service of such status and at such salary as may be determined by the Public Service Board. The Dried Fruits Control Board was constituted in 1924. It is a statutory body, and the position of secretary has always been held by an officer of the Commonwealth Public Service. The Public Service Commissioners, in looking into the matter recently, drew attention to the fact that the act, as originally framed, seemed to call for the engagement as secretary of somebody outside the Service; but it has been found that, when organizations of this kind are being set up, it is often essential that the conflicting interests which rush for the highest administrative positions should be put on one side in favour of an impartial public servant. That is why an officer of the Public Service was appointed to this position when the Dried Fruits Control Board was created some years ago. In order to set at rest doubts which have been raised, this very short measure of practically one operative clause is now . presented to the Senate, it having been already passed by the other branch of the legislature. The bill meets the wishes of the Public Service Board, and makes certain that any rights which this or any other public servant occupying such a position may have shall be preserved. It is not of a contentious nature, and I ask for its speedy passage.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate.

Report adopted.

page 418

CANNED FRUITS EXPORT CONTROL BILL 1935

Second Reading

Senator BRENNAN:
Acting Attorney-General · Victoria · UAP

– I move -

That the bill be now read a second time.

This measure has two purposes: First, to amend the Canned Fruits Export Control Act by the inclusion of canned fruit salad within the definitions of canned fruits already contained in the act; and, secondly, to preserve the rights of any officer appointed from the Commonwealth Public Service as secretary to the board.

The Canned Fruits Control Board now exercises control over the export of canned apricots, peaches, pears and pineapples, and one feature of this control is the fixing, each season, of the minimum prices at which these fruits may be sold in the principal markets overseas. At present, however, the board does not exercise any control over what is known in the trade as canned fruit salad, which is a standardized pack consisting of not less than 75 per centum of fruit contents by weight of the kinds of fruit already prescribed under the act, namely, canned apricots, peaches, pears and pineapples. This pack is becoming increasingly popular in the British market, and imports from the United States of America alone amount to approximately 600,000 cases per annum. Exports from Australia have, so far. been largely of an experi-mental nature; but the board is convinced, as a result of these experimental shipments, that the British demand for the Australian product will increase rapidly. Fruit salad is canned by the main proprietary, co-operative, and State-controlled canneries engaged in the export trade, and the industry generally supports the representations which have been made to the Commonwealth Government by the Canned Fruits Control Board that the provisions of the act should be applied to this class of commodity.

The proposed amendment is necessary in order to give effect to these representations. The provisions of clause 3 relating to the preservation of the rights of a Commonwealth officer appointed as secretary to the Canned Fruits Control Board arc” identical with those contained in the Dried Fruits Amending Bill, which has already been considered. The position of secretary to the Canned Fruits Control Board has been filled by an officer of the Commonwealth Public Service since 1926, and the circumstances which led to the drafting of clause 3 are the same as those referred to by me during the second reading of the Dried Fruits Export Control Bill.

Question resolved in the affirmative.

Bill read a second time.

In committee :

Clause 1 agreed to.

Clause 2 (Definition).

Senator DUNCAN-HUGHES:
South Australia

– I wish briefly to make a suggestion I have made on previous occasions, and which, if adopted, would be a great convenience to the general public and to the members of this Parliament. When amending bills Such as this are being drafted the whole definition should be restated so that one Could see exactly what the definitions cover. On looking at the foot of the bill honorable senators will see that there are four previous acts, and this bill makes the fifth measure dealing with the same subject. With the exception of the principal act, which is a moderately lengthy one, the others are all brief amendments, yet in order to ascertain the definition of “ canned fruits “ five acts have to be perused and it has to be extracted from three acts; and to get the definition of “ cannery “ two acts have to be consulted. I do not think that it would give the slightest difficulty to the draftsman to re-state the definition of “ canned fruits “ and “ cannery “ in amending acts. Any one purchasing the last amending measure could see the latest definitions. That would prevent one being, put to the trouble, and in some cases the impossibility at short notice, of searching successfully five separate short acts to ascertain the definition of these two words. I see no objection to, but a great deal of convenience, in the adoption of this suggestion. The only argument against it is that if producers and others concerned have to peruse all the acts the Government may sell more copies. There is also the advantage to the lawyer of being better able to piece these various measures together. I am sure that the Minister will realize the advantages of having the definitions restated so that he who runs may read.

Senator BRENNAN:
Acting Attorney-General · Victoria · UAP

.-*-I sympathize to some extent with what Senator Duncan-Hughes has said. I believe that when we were associated in another capacity this matter was discussed by us and that some representations were actually made to the Attorney-General at the time on the subject. This is not a bad example of the difficulty of which the honorable senator complains. We are now dealing with the definition of “ canned fruits “, and I have already explained that it is considered desirable to extend that definition. Whatever the present definition may be, this bill, at any rate, provides that it shall be extended to include “ canned fruit salad “. In one case a phrase is added and in another a word in inverted commas. The only effect of this amending provision is to add one more commodity to the present definitions. In any future drafting or the overseeing of any measures with which I am concerned I shall bear the honorable senator’s suggestion in mind. I know that it is extremely awkward to search preceding acts to ascertain the exact meaning of any amending provision which may be under consideration.

Clause agreed to.

Clause 3 agreed to.

Title agreed to.

Bill reported without amendment; report adopted.

page 420

DRIED FRUITS BILL 1935

Second Reading

Senator BRENNAN (Victoria- Acting

Attorney-General) [9.10]. - I move -

That the bill be now read a second time.

This bill deals with the marketing of dried fruits rather than the production or processing side of the industry.

The original Dried Fruits Act was passed by the Commonwealth Parliament in 1928, at the express wish of the Governments in the four States which produce dried fruits, namely, New South Wales, Victoria, South Australia and Western Australia. These States had already enacted legislation for the regulation ‘ of trade in dried currants, sultanas and lexias within their respective boundaries. One of the principal provisions in each of the State measures was that which empowered the State authorities to determine the quantities of dried fruits which could be sold in the home market. The States, however, had no authority to regulate the interstate transfer of goods, and withoutthat power it was not possible to ensure that the balance of the dried fruits, over and above that required for home consumption, would be exported overseas. In order to meet that position it was essential that Commonwealth legislation be passed to prohibit the interstate movement of dried fruits, except by licence, under which the licensee would be required to comply with certain conditions, including the observance of export quotas fixed by the Minister for Commerce. Two years ago there was an extension of the act which is not material at this juncture. The material point is that since 1928 the regulations promulgated under the Commonwealth Act have provided for the issue by prescribed authorities - the State Dried Fruits Board - of “owner’s” licences in respect of the owners who deliver fruit to a carrier into another State, and of “ carrier’s “ licences in respect of the carriers. The principal conditions which owners are required to observe under “ owner’s “ licences are -

  1. The furnishing of monthly returns setting out the movement of all dried fruits which come under the licensee’s control ;
  2. The marketing outside the Commonwealth of such percentage of that fruit as the Minister for Commerce, upon the report of a prescribed authority, from time to time determines; and
  3. The lodgment of security with a prescribed authority for compliance with the terms and conditions of the licence.

The only condition which carriers are required to observe under “ carrier’s “ licences is that they shall not accept delivery of any dried fruits from the owner for interstate carriage unless the owner is the holder of an “ owner’s “ licence. The terms of section 3 in the existing act do not make it clear beyond doubt that an “ owner’s “ licence, as well as a “ carrier’s “ licence is covered by the act, although the general scope of the legislation requires that provision be made by regulation for each such licence. In order to remove all doubt in this connexion it is considered desirable that express provision be made for the issue of the two classes of licence. The bill makes provision accordingly.

Experience over a period of seven years has definitely indicated that the two licences are essential for the successful operation of this legislation. The carrier’s licence is regarded as an indispensable safeguard to prevent the unauthorized movement of dried fruits between the States. All that this bill does is to ensure that carriers as well as owners shall possess a licence.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clauses 1 and 2 agreed to -

Clause 3 (Validation).

SenatorDUNCAN-HUGHES (South Australia) [9.16]. - This seems to be a very unsatisfactory clause. It provides that anything which has been done in the last seven years which was not in itself lawful as laid down in any regulation, shall be regarded as having been lawful. It validates everything done under the act from the beginning of the original act. It provides -

Any regulation made under the Dried Fruits Act 1928 or under the Dried Fruits Act 1928-1933, and any licence issued or other action taken in pursuance of any such regulation, shall be deemed to be and at all times to have been, as valid and effectual for all purposes as if this act had been in force on and after the date when the regulation was made.

This raises an issue which I have discussed in this chamber on other occasions, and is involved in the next bill to come before the Senate, although in not such an acute form, because in that measure the retrospective provision is for two years only. The clause enacts that a thing which for seven years was, in fact, unlawful, shall be regarded as lawful. I may be wrong in my reading of the clause, but to me it seems that, if we validate something which was illegal and make the provision retrospective for seven years, it is bad legislation and the kind of legislation which should not come from this side of the Senate. Moreover, it is a type of legislation which later may react unfavorably and in a direction not contemplated at the moment. I have always maintained that if a law does not give effect to the intentions of .the Government and of Parliament, we have no right to alter it and make the alteration retrospective for seven years, as in this case, or as we did only a few months ago in another measure, for twenty years.

I do not wish to speak ad nauseum on this matter every time one of these validating clauses comes, as they so often do, before this chamber. All I wish to say now is that I am, in general terms, and just as much with regard to the next bill as in respect of this one, against the validation of regulations which may not be in themselves effectual. It is not as if we were validating the act itself. This clause validates regulations made under the act. I always reserve to myself the right to exercise my judgment in respect of any particular case that comes before me, but subject to that I am always prepared to vote against any subsequent validation of a regulation which, in itself, may be held to be invalid.

Senator PAYNE:
Tasmania

– I support the remarks of Senator Duncan-Hughes. It seems to me wrong to ask honorable senators to agree to any validating provision without first giving them an opportunity to peruse closely all the regulations made under it. Unless this opportunity is given to us, how can we intelligently agree to this validating provision? Some of the regulations made under it may b°- of such a character as to impel us to withhold our endorsement. I agree with Senator Duncan-Hughes that there is an element of danger in passing a clause of this nature without, having first had an opportunity to ascertain the extent of - its application. I should like to see the further consideration of the bill postponed, so that those who are interested in the matter may peruse the regulations made under the act.

Senator BRENNAN:
Acting Attorney-General · Victoria · UAP

– I submit that there is no justification for the somewhat drastic course which Senator Payne has suggested, and I feel that I can allay also the scruples of my colleague, Senator Duncan-Hughes. I repeat what I said with regard to the two classes of licence. From the terms of the act there is no doubt that Parliament intended that two classes of licences should issue - one to owners entitling them to do certain things subject to certain restrictions, and the other to carriers enabling them to carry goods interstate under certain conditions. “It- is true that at the end of seven years some person, unknown, having studied the act, evidently came to the conclusion that it was, to say the least, doubtful whether it makes adequate provision to compel carriers to be licensed. I have looked at the original act and I do not think there is any doubt on the point. However, it is better to be on the safe side. Accordingly, it was decided to amend the act so as to put beyond all doubt the fact that two kinds of licences are required, one for owners, and one for carriers. This bill makes that provision. It also makes clear what was thought to be not quite clear, namely, that carriers are bound to take out licences. If the provision in the act was had, then a regulation which depended upon the fact that carriers’ licences had been provided for would also be bad. It is now sought to put the matter beyond all doubt, and also to provide that any regulation passed under it shall also be good in law. I agree with everything that Senator Duncan-Hughes has said in general terms against the passing of retrospective legislation. But this is a type of retrospective legislation which cannot injure anybody. It merely makes clear what everybody thought for seven years was already made clear in the act. If it rendered liable anybody who was not liable before the passing of this measure, it would be open to the criticism which Senator Duncan-Hughes has levelled against i’t. But it does no such thing. It merely makes clear something about which there appeared to have been some doubt. This being so, I do not think it is open to criticism.

Senator DUNCAN-HUGHES (South

Australia) [9.25]. - The Minister (Senator Brennan) has put his view of the clause very nicely. However, it still appears ‘to me that if the clause is to be of any effect at all, it will make possible the taking away from some person of a right which he at present possesses. Otherwise, I can see no object in it. Although the Minister assures us that no one has had this right in the past, the very fact that this clause is inserted in the bill suggests that its unintentional effect may be to take away some such right. The case would be well met, it seems to me, by providing that any regulation made heretofore under these acts shall be deemed to be valid and effectual from this date onwards. But to go back and say that any such regulation “shall be deemed at all times to be, and at all times to have been as valid and effectual for all purposes as if this act had been in force on and after the date when the regulation was made “, is beyond my comprehension, unless by so doing the intention is to take away a possible right enjoyed by some person. If no one has had any right in the past, there is no need to provide that that right shall be” taken away from him. It would be sufficient to say that for the future this regulation shall be valid. So with all respect to Senator Brennan I still maintain that this clause may have .the effect of depriving some one of his rights in the past, and for that reason I am. opposed to it.

Senator GRANT:
Tasmania

.- I challenge the right of the Government to pass this legislation, and in support of my contention I remind honorable senators of the decision of the High Court in a recent case dealing with potatoes. It seems to me that in passing this legislation we are impinging on the provisions of section 92 of the Constitution, and it is a moot point whether its validity could not be challenged. I should like to* know if there is any provision in the bill’ to compel State railway authorities and” shipping companies to take out licences for the carriage of butter interstate. It appears to me that the Government might have some difficulty with regard to thi® phase of its legislation. Whatever maybe said as to the merits of the bill, I ami opposed to the Dairy Produce Bill which legislates along similar lines. It is not fair that the producers in any State - and I speak particularly for the producers in Tasmania - should be forced to> carry on under existing conditions. I support the remarks of Senator DuncanHughes with regard to the validation of regulations for seven years. Assuming: that some person took the view that hewas not. obliged to take out a licence,, would this act make him liable?

Senator Duncan-Hughes:

– Yes.

Senator GRANT:

– It would be a hardship for him to have to pay a penalty of £100 for something which he did fiveyears -ago believing that he had acted in accordance with the law of the land. Theposition was not set out clearly in the act, and a person would be justified in> saying that it was not intended because the law had been altered in the meantime to make it clear. I support thecontention of .Senator Duncan-Hughes.

Senator BRENNAN:
Acting Attorney-General · Victoria · UAP

– I am sorry that Senator Grant has taken up the cudgels with Senators DuncanHughesand Payne. I assure the Senatethat the only right of which any one has been deprived is the right to take action to try to upset things on a very flimsyground.

Senator Duncan-Hughes:

– The right of a person to assert his rights.

Senator BRENNAN:

– The act has been administered in the belief that carriers have been required under it to take out licences. It is true that the provision was awkwardly framed, and there was a doubt about carriers being compelled to take out licences. Honorable senators can be assured, however, that this bill has not been introduced to penalize those engaged la carrying, noi- have they claimed that they are not bound to take out licences. No person has raised that point, and this legislation is not aimed at any person or body of persons in particular.

As to the constitutional aspect of the question, which was raised by Senator Grant I agree that the whole of this class of legislation, which is based on section 51 (i) of the Constitution, and also on a judgment of the High Court, which says that section 92 of the Constitution is not addressed to the Commonwealth, and is not binding on the Commonwealth, is on a very shaky foundation. Some day the Privy Council may say that it is addressed to the Commonwealth. In that event, all this class of legislation would fail. In the meantime, we must take the law as it is. The High Court has interpreted the law to mean that section 92 is not binding on the Commonwealth, although it is binding on the States, and this legislation is based on that interpretation.

Clause agreed to.

Title agreed to.

Bill reported without amendment; report adopted.

page 423

DAIRY PRODUCE BILL 1935

Second Reading

Senator BRENNAN:
Acting Attorney-General · Victoria · UAP

– I move -

That the bill he now read a second time.

This bill is designed to cover, in respect of dairy produce, exactly those things that are covered in the Dried Fruits Bill, with which the Senate has just dealt. As Senator Duncan-Hughes has just pointed out, however, its retrospective provisions do not stretch so far back into the past, because in this case the original act was not passed until 1933. During the period from January, 1926, to May, 1934, a voluntary scheme, ‘known as the Paterson plan, which was in operation in the dairying industry, had the effect of stabilizing the price of butter in Australia. The scheme, however, was not sufficiently binding to ensure the full support of the manufacturers of butter, and consequently the Dairy Produce Act was passed towards the end of 1933. This enactment was supplementary to legislation passed at the same time by the Parliaments of New South Wales, Victoria, Queensland and Tasmania. The powers given in the federal act were similar to those in the Dried Fruits Act, and were designed to regulate the interstate trade in dairy produce, while the State acts provided for the regulation of the trade within the respective States. In practice, the authority set up by each State act fixes the proportion of that State’s production of ‘butter and cheese which may be sold on the local market, and the federal act, in effect, protects that allocation by regulating the movement of such produce from one State to another, and ensuring that the surplus production of butter and cheese is removed from the Australian market. The Dairy Produce Act was brought into operation by proclamation issued on the 2nd May, 1934, and provision was made under it for the taking of a poll of producers throughout the Commonwealth within six months from that date to decide whether or not the act should continue to operate. The poll resulted in an overwhelming majority of votes being recorded in favour of continuance, the figures being 50,747 in favour and 1,416 against. Regulations issued under the Dairy Produce Act provide for the granting by prescribed authorities in the various States of both “owners’ “ and “carriers’ “ licences on a basis somewhat similar to that on which licences are issued in respect of dried fruits. There is, therefore, no need for me to repeat the reasons which led to the preparation of this bill, in view of the similarity of the provisions of the two acts, and the details already given by me in moving the second reading of the Dried Fruits Bill.

Senator GRANT:
Tasmania

– At an earlier stage of to-night’s proceedings the Leader of the Government (Senator Pearce) interjected when I was speaking that the carriers knew for some years the intention of Parliament with respect to licences. I should like to know whether the State railways, or the shipping companies trading between Tasmania and the mainland, have taken out licences.

Senator Brennan:

– I cannot say definitely; but I understand they have done so.

Senator GRANT:

– My information is to the contrary, although I, too, cannot say so definitely. I understand that neither the shipping companies nor the State railways have taken out licences, and probably this legislation has been suggested in order to require them to do so. The remarks which I have directed against the bill with which we have just dealt apply also to this measure. I object, to the validating clauses, and also to any restriction being placed on trade between the States.

Senator BRENNAN:
Acting Attorney-General · Victoria · UAP

– As I said just now by way of interjection, I am not certain whether the State railways or the shipping companies have taken out licences, but I can assure Senator Grant that this amending legislation is not aimed at those bodies, or, indeed, at any individual, company, or corporation. The amendment originated in the AttorneyGeneral’s Department, not with those who are charged with the- administration of the act. Nor did it arise from any doubt regarding the necessity for carriers taking out licences.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clause 1 agreed to.

Senator BRENNAN:
Acting Attorney-General · Victoria · UAP

– I move -

That after clause 1 the following new clause he inserted: - “ 1 a. Section 4 of the Principal Act is amended -

by omitting from the definition of dairy produce’ the words * but does not include processed cheese’; and

) by omitting “the definition of ‘ processed cheese ‘.”

The explanation is a little complicated. In the original act the definition clause defines “ dairy produce “ to mean butter and cheese, but not processed cheese, while “ processed cheese “ means any cheese manufactured and sold in the Commonwealth which has been subjected to any further prescribed process of manufacture. The necessity for this amendment was brought under the notice of the Government after the bill had passed through the House of Representatives. The effect of the proposal to amend the act by deleting from it all reference to processed cheese, is that the transfer of this class of commodity from one State to another will be permitted only under licence. When the principal act was passed in 1933, all processed cheese was, so far as was known, made from cheddar cheese purchased at the ruling Australian price, which cheese consisted of the whole or portion of the quota which the manufacturer was entitled to sell on the Australian market. In these circumstances it appeared to be justified that processed cheese should be exempted from the provisions of the act, because it was not intended that the processed article made from homeconsumption cheddar cheese should be subjected to a further export quota.

Since then, however, at least two of the largest makers of processed cheese have decided to manufacture their own cheddar cheese, and under the act as it now stands, these processors are permitted to market within Australia the. whole of their production of cheddar cheese in the form of processed cheese. This gives the processors a distinct advantage over those who are engaged solely in the manufacture of cheddar cheese and are required to export a substantial percentage of their output. The present export percentage is 39 per cent.

It is possible that the practice will rapidly extend if the exemption for processed cheese is allowed to continue, with the result that an increasing percentage of cheddar cheese will be automatically displaced from the Australian market, throwing the onus of additional export on those who manufacture cheddar cheese only. Honorable senators will agree that this is an anomaly which should be rectified without delay.

In the case of those processors who still purchase their requirements of homeconsumption cheddar cheese from other manufacturers, an exemption from the export-quota provision of the interstate licence will he provided for in the regulations.

The proposal to bring processed cheese within the provision of the act is strongly recommended by the State dairy products boards, which act as prescribed authorities for the Commonwealth in connexion with the issue of licences for the interstate transfer of butter and cheese. At the same time the proposal will bring the federal act into line with the State Dairy Products Acts which do not provide for any exemption in respect of processed cheese, except in the case where the cheese is processed from home consumption cheddar cheese.

Proposed new clause agreed to.

Glauses 2 and 3 agreed to.

Title agreed to.

Bill reported with an amendment.

Senate adjourned at 9.50 p.m.

Cite as: Australia, Senate, Debates, 28 March 1935, viewed 22 October 2017, <http://historichansard.net/senate/1935/19350328_senate_14_146/>.

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